Tax strategy

The ultimate responsibility for Sage’s tax strategy and compliance rests with the Group Board who ensure that the appropriate framework is in place to oversee the identification and management of tax risk.

The chief financial officer (CFO) is the Board member with executive responsibility for tax matters. Quarterly Tax Committee meetings are held with the CFO, EVP Group Financial Controller, and VP of Group Tax in attendance to ensure there is appropriate governance and operational oversight on all material tax matters. Day-to-day management of tax affairs is delegated to the VP of Group Tax who has a global integrated team of appropriately qualified individuals.

The Group CFO and UK Senior Accounting Officer are regularly appraised of all significant tax developments and participate in all material tax-related decisions.

Sage seeks to correctly apply the tax legislation to its business operations and, in doing so, aims to minimise its tax risk. In doing so, Sage actively seeks to identify, evaluate, monitor, and manage tax risks.

Internal controls and escalation procedures are put in place with the aim of identifying, quantifying, and managing key tax risks as well as ensuring compliance with the UK Senior Accounting Officer rules. These key risks are then monitored for business, policy, and legislative changes and, as a result, tax processes or controls are updated where required. The Group Audit & Risk Committee oversees Sage’s tax control environment through the regular review of the tax strategy.

Appropriate training is carried out for staff who manage or process tax matters.

We recognise that tax legislation can be complex and sometimes subject to interpretation and this uncertainty could give rise to tax risk. Where there is uncertainty in how the relevant tax law should be applied, external advice is sought to support the Group’s decision-making process. We may also look to engage with global tax authorities (“Tax Authorities”) to disclose and resolve issues, risks, and uncertain tax positions.

The Group undertakes tax planning only where it supports genuine commercial activity, is consistent with Sage values, takes due consideration of our brand and reputation, and is compliant with all relevant tax laws and practices. We do not operate in low tax jurisdictions unless there is genuine commercial activity in that territory.

We may utilise tax incentives or opportunities for obtaining tax efficiencies where these are not considered to impair that commitment.

The Group adheres to the OECD Transfer Pricing guidelines, as well as any other relevant transfer pricing rules, regulations, or requirements in the territories in which it operates, in the determination of the arm’s length pricing for related party transactions.

We seek to have collaborative and co-operative relationships with Tax Authorities through regular meetings and communications in respect of developments in Sage’s business as well as our view on current, future, and retrospective tax risks.

All interactions with Tax Authorities are conducted in an open, collaborative, and professional manner. Sage ensures that Tax Authorities are kept aware of significant transactions and changes in the business, subject to any commercial or confidentiality constraints. Where possible, any tax issues arising are discussed with the relevant Tax Authorities at an early stage.

When submitting tax computations and returns to Tax Authorities, we disclose all relevant facts and circumstances. We may meet with relevant Tax Authorities to discuss any transactions or issues where there is potential for the tax treatment to be uncertain.

This tax policy is in line with our global Code of Ethics and our Sage Values. The policy is approved and owned by the Board.

The Sage Group plc regards this publication as complying with the duty under para. 16(2) and para. 25(1), Sch 19 FA16.