what you need to know about UK tax policy.

Introduction

The Chief Financial Officer of the UK and Ireland is responsible for leading the UK tax strategy as a board member.

The enclosed strategy has been approved by both the UK board of directors and Randstad Global Tax department based in the Netherlands, which is part of the ultimate controlling party, Randstad NV.

This document is reviewed on an annual basis and any amendments thereto are made where necessary and this policy will remain in force until further notice.

Background

Randstad is the global leader in the HR services industry, and it supports people and organisations in realising their true potential by combining the power of today’s technology with its passion for people. Randstad call it “Human Forward “and in 2023, it helped more than 1.9 million candidates find meaningful jobs with its 207,900 clients and trained more than 364,500 people. Randstad is active in 39 markets around the world and has one of the largest footprints in the industry and in 2023 it had on average 43,340 corporate employees and generated revenue of € 25.4 billion. The company was founded in 1960 and its headquarters are in Diemen, the Netherlands and Randstad N.V. is listed on the NYSE Euronext. For more information, see www.randstad.com

Randstad's values and business principles

Randstad is the global leader in the HR services industry and its core values were established in the early days of its existence and these principles continue to serve as a compass for everyone at Randstad, to guide its behaviour and to shape its culture.

One of its core values is ‘the simultaneous promotion of all interests’: its stakeholders are at the heart of its strategy, it serves their interests and creates lasting value for all of them – its clients, its candidates, its employees and other stakeholders including governments, while its business benefits society.

For the year ended 31 December 2023 the publication of this strategy statement is regarded as satisfying the statutory obligation under paragraphs 19(2) and 22(2), Schedule 19, Finance Act 2016 for the UK companies within the Randstad Group.

Overall tax strategy

The overall UK tax strategy is as follows:

• Pay the proper amounts of taxes in the countries where value is created.
• Meet all legal requirements and make appropriate returns and payments in a timely manner.
• Utilise all available tax credits and reliefs available to the UK companies in line with the company’s strategy.
• Consider the tax implications of all major business decisions.
• Ensure adequate tax controls are in place for all UK companies as part of the Randstad Global Key Control Framework.
• Ensure there is Board accountability and oversight for all tax matters.
• Ensure no detrimental reputation impact to the Randstad brand due to tax decisions and actions.
• Maintain an open and honest relationship with the tax authorities.

Key control framework

Randstad’s company risks are governed by its Key Control Framework of which Tax Controls form a part and the effectiveness of these controls is assessed twice per year for all UK & Irish based companies. The controls are subject to regular internal audits.

The purpose of Tax controls within the Key Control framework is to ensure that the Randstad group is in control of all its tax compliance obligations and does not incur any unexpected material tax charges.

Risk management

Randstad operates in many markets within the UK including construction, education, financial services, business solutions and student support and its risk appetite is aligned with its strategic priorities and these elements include:

• Taking a zero-tolerance based approach to breaches of its core values and business principles, and
• Protecting and maintaining its reputation and the image of its brands.

Randstad’s main risks are those that threaten the in-control position of the Group. The current risks have been categorised into four areas: strategic, operational, financial & reporting and compliance.

Reputation is considered a strategic risk, financial & reporting risks include the valuation of deferred tax assets and goodwill, while tax compliance is listed as a compliance risk.

The company has a Tax Team which is responsible for all tax compliance and reports directly to the Chief Financial Officer and there is constant communication between the finance department, board members and the wider operational business on all tax matters. The business has a positive view towards tax and all parties understand the importance of meeting the company’s obligations.

Tax planning

Any action related to planning Randstad’s tax position must be consistent with the normal course of business and in line with its overall country and global group strategy. Therefore, business profits are generated where Randstad has legal and economical ownership of assets and where relevant people manage such assets.

Randstad ensures that the appropriate portion of taxable income is reported in UK based Randstad entities where value is created within the normal course of business in proportion with the functions performed, assets deployed, and risks assumed.

All of Randstad’s intercompany transfer pricing and policies are based on an “arm's-length principle”, which means that transactions are entered into as if they were made between unrelated parties and the price is governed by the market.

Randstad will seek external tax advice on a case-by-case basis to assist with tax scenarios if it does not have the expertise to resolve them internally. Occasionally the company asks its external advisors to review its in-house decisions and act as an independent consultant if there is any uncertainty.

Attitude towards risk and tax planning

Randstad views tax compliance as extremely important and key to managing tax risk. The UK board does not pursue any aggressive tax planning arrangements and tax forms part of the business decision making process. Randstad’s relationships with both key advisors and HMRC help it to remain compliant and fully understand tax changes that might affect the business in the future. The Randstad Global Tax department also works very closely with the UK companies to ensure that  actions taken by the UK fit within the overall global tax strategy.

Total tax contribution

Randstad is a sizable taxpayer in the UK and therefore an important contributor to society and pays the following:

• Payroll tax
• Social security contributions
• Apprenticeship levy
• Value Added tax
• Corporation tax

Grievance mechanism

Randstad has a misconduct reporting procedure in place, which enables its stakeholders to report any suspicion of wrongdoing via a secure phone line or website.

Working with HMRC

Transparency and trust are embedded in Randstad’s business principles and corporate culture, thus play an important role in the way it engages with HMRC. As part of that engagement, the company actively seeks collaborative dialogue with HMRC.

Randstad aims to ensure timely tax compliance including meeting all relevant filing and payment deadlines for all company taxes and if any significant uncertainty were to arise concerning tax matters, it engages with HMRC directly to ensure that the law is interpreted correctly.

Any changes to business strategy or approach which might impact company taxes in the future are fully disclosed and communicated to HMRC for review and comment. Randstad’s objective is to obtain early agreements on any disputed matters that might arise with HMRC to avoid any uncertainty which might have an impact on the UK business.

Randstad works closely with its Customer Compliance Manager (CCM) at HMRCE with regular direct contact taking place between the CCM and its Chief Financial Officer and the intention is for this to continue indefinitely. Randstad has previously contributed to HMRC consultations that impact its business directly and will continue to do so thus following the global tax policy set by its ultimate controlling parent company, Randstad NV, that is part of the so called “enhanced relationship program” of the Dutch tax authorities, which is based on mutual trust and transparency.

Global tax policy

More information on the Randstad global tax policy can be found on the Randstad corporate website.