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Returns And Refunds
Returns And Refunds
UK TAX STRATEGY
This document has been prepared and it is intended to satisfy the reporting obligations foreseen under paragraph 16(2) of Schedule 19 of the Finance Act 2016.
This document applies to Valentino England Limited (“VUK” or the “Company”), a UK resident company part of the Valentino Group and directly controlled by Valentino S.p.A. (“Valentino”), and sets out the Company’s approach to tax for the year to 31 December 2023.
In Valentino Group, a strong focus is dedicated to the corporate responsibility, where a responsible administration of tax matters and the accurate payment of taxes are two of its pillars.
1. APPROACH OF THE VALENTINO GROUP AND UK COMPANIES TO RISK MANAGEMENT AND GOVERNANCE ARRANGEMENTS IN RELATION TO UK TAXATION
1.1 Tax Governance
The Company’s UK tax strategy reflects the principles set out in Valentino Code of Conduct which is published on Valentino SpA’s institutional website. The Valentino Code of conduct provides a common framework and a set of principles that inspire our business conduct and guide us in the exercise of our responsibilities. The adherence to national and international laws and regulations and the application of best practice policies are fundamental principles underpinning the Valentino Code of Conduct.
The Company has a strong focus on responsible tax administration and it is committed to respecting both the letter and the spirit of the law and to pursing the values and principles in the Valentino Code of Conduct to ensure responsible behaviour.
Day-to-day tax responsibility sits together with the Head of Tax and the UK Finance Manager, who is also responsible to ensure that Company tax accounting representation is appropriate and transparent in respect of the taxes to be paid.
The Valentino Group risks and issues, including the ones related to taxes, are considered by Valentino Group management and by the Head of Internal Audit on a regular basis.
The Board of Directors of VUK is ultimately in charge for the oversight of risk management and governance arrangements of the UK business.
1.2 Tax risk management
Presently the Valentino Group has companies in several countries and it is exposed to a variety of tax risks as follows:
- tax compliance and reporting risks,
- transactional risks,
- reputational risks.
In order to mitigate all of them, the Valentino Group and VUK aim to put in place the resources, governance, processes and controls necessary to ensure that local tax filings and reporting are robustly prepared.
The business is supported by different functions, including the Group Tax, the Group Controlling, the Europe Retail Controlling and the Group Internal Audit, but also from external tax advisors and auditors.
Valentino provides an additional level of support and technical expertise to the Company on matters of group relevance (e.g. the application of Group Relief) and is in charge of informing the Valentino group companies (and also the Company) about important UK developments with the help of external UK advisers.
Moreover, where appropriate, Valentino and VUK consider positively to contact local tax authority (i.e. HMRC) to disclose and resolve issues, risks and uncertain tax positions.
The Company is liable to account for a broad range of UK taxes including corporation tax, VAT, PAYE, National Insurance Contributions, and Stamp Duty Land Tax. VUK is committed to compliance with UK tax law, regulation and disclosure requirements by:
- filing complete and accurate returns on a timely basis,
- paying the right amount of UK tax at the right time,
- seeking advice from external advisors to provide additional expertise where considered appropriate.
The tax returns of the company are prepared by our external UK tax consultants and are based on information supplied by the Company. These are reviewed and approved by the Company prior to submission to HMRC.
Nevertheless, the subjective nature of tax legislation means that it is often not possible to fully mitigate all known tax risks.
2. ATTITUDE OF VUK TO TAX PLANNING
VUK recognizes to have a responsibility to pay an appropriate amount of tax in the UK jurisdiction (the same approach is adopted by each entity of the Valentino Group in each jurisdiction where operates).
VUK aims to balance this aspect with the responsibility to its shareholder to structure the affairs in an efficient manner, in a way that the economic benefits associated with tax planning must never override the compliance with all applicable laws.
Consequently the Company will ensure that:
- tax planning and arrangements are simple, based always on business purpose and well-understood.
- business teams understand and consider the tax risks in order to minimize any exposure.
3. LEVEL OF RISK IN RELATION TO UK TAXATION THAT THE GROUP IS PREPARED TO ACCEPT
The Company is not prepared to accept anything other than immaterial levels of risk in respect of the application of UK legislation: where tax law is unclear or subject to interpretation, the Company tax position is at least “more likely than not” to be allowable under applicable tax laws.
Consequently, VUK will utilize all available tax reliefs and tax incentives where available in a manner which is consistent with the interpretation of the tax law and the as much as possible in line with the HMRC position.
Additionally, the Company considers timely compliance with tax legislation to be key to managing the Company’s tax risk and does not engage in artificial tax schemes. As described above, the Company benefits from Valentino Group oversight on certain specific tax matters and makes use of the expertise of external tax advisers to manage its tax risk exposure.
This is the best position to avoid unnecessary and time-consuming tax disputes wherever possible.
4. APPROACH TOWARDS TAX DISCLOSURE IN FAVOR OF HMRC
VUK seeks to meet all legal requirements, preparing and filing all appropriate tax declarations, tax reporting and tax payment obligations. Valentino Group seeks to foster good, open, cooperative and professional relationships with local tax authority, and so the Company with HMRC, in particular pro-actively supporting:
- VUK’s relationship with HMRC with the aim of minimizing the risk of challenges, litigations or damages to its reputation,
- VUK’s participation in any tax consultation process where it is expected that the matter under consultation will have a material tax impact on the Company,
- VUK’s collaboration with HMRC in case of tax audit.
The Company employs the services of professional tax advisers to act as its agents, and where appropriate, they liaise with HMRC on its behalf on a real-time basis.
Date published: 9th January 2023