This document sets out the Tax Strategy for FANUC UK Limited (“the Group”) and all of its associated UK Group companies. Any reference to tax includes all taxes and duties. The strategy has been approved by the Board and satisfies the Group’s requirements under Schedule 19 of the UK Finance Act 2016 in respect of the period ending 31 March 2018.
The Group is a UK manufacturer and distributor that is a member of the Japanese headquartered FANUC Group of companies which provides industrial automation solutions. FANUC Global Group activities include the supply of CNC controllers, lasers, robots, machining centres, EDM and injection moulding machines to the complete integration of factory automation systems; providing a single customer support portal for its three core businesses.
The global FANUC Group has almost 60 years of experience in the development of computer numerical control equipment, with more than 22.5 million products installed worldwide and more than 6,000 employees. Whether it’s industrial robots, CNC systems, wire cut EDM, injection moulding machines or vertical machining centres, there is nothing we love more than automation.
The UK Group maintains a strong team providing sales, engineering, training, parts and service support, with a team that always understands a client’s needs and speaks their language, a global player with a human face.
Our overall aim for tax is to support delivery of the commercial objectives of the Group in an efficient manner that complies with all relevant tax laws and is in line with the guidelines established in our Tax Strategy and code of conduct. The Group’s Tax Strategy also supports delivery of our 5 year strategic plan which is communicated across the business.
The Tax Strategy also follows the Groups corporate governance principles of preciseness and transparency which apply to all activities of officers and employees of the group. Our Tax Strategy also takes into consideration all stakeholders such as customers, employees, shareholders, suppliers and local communities. Delivery of this Tax Strategy is supported by our Tax Governance Policy and Tax Risk Register which are aligned to our overall Group approach to risk management.
Approach to tax risk management and governance
The Group’s Finance Manager has overall ownership of this Tax Strategy whilst the finance team have day-to-day responsibility for delivery of it. The responsibilities include working with outsourced tax compliance advisors and ensuring adherence with all statutory filing, reporting and payment obligations. Processes and controls are in place to mitigate tax risks and these have been designed in a way that is proportionate to the size and nature of the Group’s operations. All tax activities are also overseen by the European finance team, based in Luxembourg, where risk mitigation and tax compliance are top priorities.
Our Tax Risk Register and associated tax controls allow the Group to identify and manage risks on a regular basis and in a proactive way that is aligned to the level of tax risk that we are prepared to accept. The Tax Governance Policy sets out the processes in place to identify, evaluate, mitigate and monitor key tax risks and controls. Our Tax Risk Register identifies the Group’s key tax risks and approach to mitigating these and is supported by documentation of key policies, controls and processes that are designed to minimise the tax risks that may arise on a day-to-day basis
Members of the finance team who have a responsibility for tax have access to suitable training and guidance and we also work closely with external advisors to ensure that significant tax risks are appropriately managed in line with the tax risk appetite of the Group. The Group’s Finance Manager works closely with the Luxembourg team who are closely involved in all key global Group business and operational decisions to ensure that tax risks and opportunities are appropriately considered in line with this strategy. As is outlined in our governance policy, we may also provide explanations to the Board, Directors and auditors from time to time, focusing on important matters under laws and regulations, including tax.
Level of risk we are prepared to accept
The Group’s tax risks are managed in accordance with our Code of Conduct, which includes the expectation of preciseness and transparency in compliance with all laws and regulations. Aligned to this, our tax and finance operations are undertaken with consideration for all stakeholders and only structured based on sound commercial and business principles. The Group’s approach to tax risk management, and level of risk that is acceptable based upon this, is clearly defined within our Tax Governance Policy and is aligned to our overall business approach to risk management.
We aim to minimise tax risk but also acknowledge that the complexity of tax legislation mean it is impractical to remove all tax risk that may arise. To support us in minimising tax risk, we will seek external advice where we identify significant or unusual tax positions. As is outlined below, clearance may also be sought from tax authorities in certain scenarios.
Attitude towards tax planning
All decisions regarding tax and tax planning will be undertaken in accordance with our code of conduct principal of “preciseness and transparency” and with consideration for all stakeholders such as customers, employees, shareholders, suppliers and local communities. This ensures that as a Group we uphold high standard of ethics, comply with laws, regulations and internal rules, and contribute to the good of the global Group. This Tax Strategy has also been communicated to relevant advisors, alongside the expectation that all advice provided should comply with it.
We strive to be tax efficient in order to support our commercial objectives and delivery of our 5 year strategic plan, but we will not enter into any aggressive tax planning arrangements. We will consider a range of options when undertaking commercial transactions and may choose the most tax efficient manner, but only if it is in line with our commitment to comply with UK tax law, our code of conduct and our defined acceptable level of tax risk. We will seek external advice in relation to areas of uncertainty to ensure any planning that is undertaken complies with this, whilst we also aim to utilise all available tax reliefs, incentives and exemptions that are made available by tax authorities.
Approach towards dealing with tax authorities
We aim to comply with all applicable tax laws and regulations and to do so will engage with external tax advisors when significant transactions are undertaken or in areas of uncertainty. We may also seek guidance or clearance from tax authorities in relation to specific historic, current or future events where there is uncertainty regarding the interpretation of tax law. This engagement with tax authorities will be at the discretion of the Group’s Finance Manager.
Our current engagement with tax authorities is limited to meeting our compliance obligations and ad-hoc tax compliance review. In all dialogue with tax authorities we are committed to disclosure of all of the relevant facts on a timely basis. We will also work with tax authorities to answer any queries or resolve any differences in a timely and professional manner. If and when further engagement is required, we will aim to build a relationship that is both open and transparent, such that it aligns to our Code of Conduct and corporate governance principles.