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FTSE 100 tax dispute provisions up to £2.39bn

Some of the largest firms in the UK have made increased provisions to handle worldwide litigation and tax disputes.

FTSE 100 firms have made an additional £139 million in tax provisions to manage tax bills that are contested, which sees the total now stand at £2.39 billion, according to a study conducted by Thomson Reuters.

The organisation’s Raichel Hopkinson believes that the move represents an increased emphasis by the Government on maximising revenue from tax bills.

She said that governments have an obligation to recoup further tax and that authorities from all over the world are beginning to be more aggressive, taking advantage of tax rules as much as possible in order to put a stop to any potential avoidance.

Pharmaceutical companies listed on the FTSE 100 made the largest tax provision for disputes over the past 12 months.

Transfer pricing is the biggest factor in their provisions.

Hopkinson added:

“Pharmaceutical companies have been at the centre of many of the biggest ever tax disputes. That is partly become the revenues that flow from one part of a pharmaceutical business to another are huge – meaning so much potential tax is at stake.”

The Government’s crackdown may be emphasising larger companies, but it won’t be allowing small businesses to be complacent about submitting accurate figures either. A reputable accountant in the Wirral, however, is more than capable of ensuring that that is the case, so businesses in the region have little need for concern.

Posted by Mark
July 31, 2014
Finance

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