Schuh’s ultimate parent company, Genesco Inc. is a US resident entity listed on the New York Stock Exchange. Genesco holds Schuh through a UK holding company, Genesco (UK) Limited. This tax strategy (the “Tax Strategy”, or the “Schuh Tax Strategy”) applies to the Genesco (UK) Limited subgroup (“we”, “our” or “Schuh”) including Schuh’s UK and overseas operations.
The Tax Strategy is owned, approved and implemented by the Schuh Board of Directors and has been developed with the oversight of the Genesco group tax team. The Schuh finance team are responsible for maintaining and updating the Tax Strategy in response to changes in the organisation or tax legislation and amendments will be subject to Board approval.
Publication of this Tax Strategy is regarded as complying with the duty of Part 2 of Schedule 19 of Finance Act 2016 in respect of the financial year ended 31 January 2018.
Commitment to compliance
In line with the Genesco Code of Ethics, all employees and directors are expected to comply with both the letter and spirit of all applicable governmental rules and regulations. This commitment extends to tax laws and regulations, meaning we seek to calculate our tax liabilities accurately and settle them on time in all countries where Schuh operates. In respect of intercompany transactions we apply transfer pricing policies established by Genesco. These have been developed with the support of independent advisors in order to ensure compliance with OECD principles. We are opposed to all forms of financial crime and are committed to preventing the facilitation of tax evasion.
Governance and risk management
The Schuh Board of Directors takes the lead in establishing Schuh’s governance and risk management culture and oversees our approach to tax risk. We look to manage tax risk in line with other commercial risks that the group is subject to, ensuring a consistent approach to risk management across the business.
Schuh’s Director of Finance and HR has ultimate responsibility and accountability for Schuh’s tax affairs and for keeping the Board appraised of material tax issues. Our UK finance team works closely with our HR and payroll functions, together with external advisors, to ensure Schuh complies with all of its UK tax obligations. The UK finance team maintains a dialogue with the Genesco group tax team to ensure effective collaboration and oversight on both UK and international tax matters. Where appropriate, staff receive formal training on new legislative requirements to promote awareness of the rules and ensure compliance with our ethical and risk management policies. The arrangements in place are designed to ensure that all significant tax related decisions are subject to review and approval by appropriately qualified and experienced staff and that Schuh’s tax obligations are met.
As a US listed group we are subject to the provisions of the Sarbanes Oxley Act (“SOX”) and have extensive regulatory requirements to adhere to. Compliance with SOX supports the integrity of the underlying financial data on which the tax returns are based.
Schuh also falls within the UK Senior Accounting Officer (“SAO”) legislation under which the SAO is required to take reasonable steps to ensure the company establishes and maintains appropriate tax compliance arrangements. As such, we regularly review our processes and controls for tax, updating these in line with best practice and relevant changes to the tax laws and regulations.
Tax risk appetite
As an international business, Schuh is subject to a range of tax risks which we look to manage responsibly in line with our risk management processes. Where there is significant uncertainty or complexity in relation to a tax risk, external advice may be sought. We take a conservative approach to uncertain tax matters and will often seek tax authority input at an early stage to minimise the risk of dispute.
Approach to tax planning
We claim tax reliefs and government incentives where available and in the manner they are intended (e.g. apprenticeship levy credits, capital allowances etc.). Taxes are considered as part of decision making, budgeting and forecasting process and whilst we try not to incur unnecessary taxes we do not enter into artificial or contrived structures for the avoidance of tax.
Approach to dealing with tax authorities
Our aim is to have a professional and transparent relationship with tax authorities in the jurisdictions in which we operate. We seek to resolve any differences in a collaborative manner.