SHI International Corp. – UK Tax Strategy

SHI International Corp. is a global provider of Information Technology products and services. The group has grown organically from a $1 million reseller in 1989, to a $10 billion corporation in 2018.

Headquartered in central New Jersey, SHI has over 30 offices throughout the US, Canada, Asia and Europe and employs over 4,000 people.

This statement sets out the UK tax strategy of the UK permanent establishment of SHI International Corp. (SHI PE) and SHI Corporation UK Limited (SHI Ltd) including their approach to tax risk management, attitude towards tax planning and working with HMRC.

The publication of this statement is regarded as fulfilling the entities’ obligations under Paragraph 22(2) Schedule 19 Finance Act 2016 to publish their UK tax strategy for the financial year ended 31 December 2020.

Approach to tax risk management

SHI Ltd was previously dormant and therefore not liable to UK taxation; however, SHI Ltd began trading in April 2020. In conjunction with this, SHI PE, which has historically been the trading permanent establishment of SHI International Corp., has begun winding down its operations. In this transitional period, both entities are within the scope of UK taxation.

SHI PE and SHI Ltd are therefore subject to a range of UK taxes on their UK activity, including payroll taxes, corporation tax and VAT. The Board of Directors of SHI International Corp. and the Director of SHI Ltd are committed to acting responsibly through compliance with UK tax law, regulation and disclosure requirements in respect of SHI PE and SHI Ltd by:

  • Paying the right amount of tax at the right time;
  • Filing complete and accurate returns on a timely basis;
  • Seeking to utilise available tax reliefs and incentives where available in a manner which is consistent with the government’s policy objectives; and
  • Working with professional advisors in the UK to ensure compliance with UK tax law and practice.

The overall responsibility for the tax strategy of the UK permanent establishment of SHI International Corp. rests with the SHI International Corp.’s Board of Directors based in the United States. The overall responsibility for the tax strategy of SHI Corporation UK Limited rests with the Director of the company, who is also based in the United States. The day to day management of SHI PE and SHI Ltd’s tax affairs is undertaken by SHI PE’s finance team. The finance team consult with external advisers to provide local expertise when it is required.

Attitude towards tax planning

SHI PE and SHI Ltd do not have a Code of Conduct in relation to taxation but will consider a range of factors including the tax laws of the countries that they operate in when deciding upon the structure of commercial activities. Transactions are not structured in ways that result in tax implications that are inconsistent with their underlying economic consequences.

SHI PE and SHI Ltd only partake in transactions that relate to genuine commercial activity with economic substance. The entities do not participate in artificial tax avoidance schemes that aim to reduce UK or overseas tax liabilities.

Where a transaction is considered, the finance team will consult with external advisors to understand the tax implications of the transaction. Where the transaction may result in adverse tax consequences the finance team will look for alternative ways to structure the transaction to achieve the same commercial outcome without the adverse tax consequences.

The finance team use external advisors to help them legitimately mitigate their tax liabilities, utilising tax reliefs that are available (such as capital allowances and annual investment allowance) in the most efficient way.

Level of tax risk accepted

SHI PE and SHI Ltd adopt a responsible and proactive approach in relation to tax affairs and will only accept a low level of risk. Where tax risks are identified they are managed in an open and ethical way, with advice from external advisors where this is required.

Working with HMRC

SHI PE and SHI Ltd work with external advisors to ensure tax filings and tax payments are made on time. SHI PE and SHI Ltd do not have a Customer Compliance Manager or other dedicated contact with HMRC but act collaboratively in an open and transparent manner in all dealings with HMRC. If faced with uncertainty as to the application of certain tax laws, a proactive approach of engaging with HMRC in advance of undertaking any transactions may be adopted to confirm the correct application of tax law.

SHI PE and SHI Ltd only partake in transactions that relate to genuine commercial activity with economic substance. The entities do not participate in artificial tax avoidance schemes that aim to reduce UK or overseas tax liabilities.

This strategy is owned and approved by the Board of Directors of SHI International Corp. and SHI Corporation UK Limited respectively.

January 1,2021