CONSCIOUS APPROACH TO TAX 2022
This document applies to Rituals Cosmetics UK Ltd. which has a duty to prepare a ‘large business tax strategy’ under Schedule 19, paragraph 21 (2) of the Finance Act 2016 for its fiscal year ending on 31 December 2022.
At Rituals Cosmetics we take a conscious and responsible approach to the worldwide management of taxes to contribute to a more stable, secure, and sustainable society and be part of the change we would like to see in this world. In line with this, we are proud that Rituals is a Certified B Corp™ - meaning that we are a company using business as a force for good.
Rituals Cosmetics UK Ltd. is responsible for the activities of Rituals Cosmetics in the UK. In FY21, we operated 40 Rituals retail stores across the UK and employed an average of 132 full time employees. The effective tax rate of Rituals Cosmetics UK Ltd. in FY21 was 25,58% compared to the UK statutory corporate tax rate of 19%.
OUR CONSIOUS APPROACH TO TAX RISKS
Within Rituals Cosmetics, we have a code of conduct in place that sets out the behavior we expect from all our employees. Tax evasive behavior is not accepted, and all our employees are educated on this principle as part of our ‘Rituals Fundamentals’ trainings.
At Rituals Cosmetics, we are committed to ensure full compliance with all our tax obligations. We adopt a risk averse approach to taxes in all countries where we are active - including the UK - minimizing the risks of disputes with tax authorities.
We maintain strong relationships with external tax advisors and consult HMRC whenever we are in doubt on the correct interpretation of tax legislation and our obligations. External tax advice is obtained when the necessary expertise is not available in-house.
OUR ATTITUDE TOWARDS TAX PLANNING
Rituals Cosmetics ensures that its -conscious approach to tax- results in paying a fair tax in all the countries it is active, without overpaying. We try to mitigate double taxation as much as possible and avoid artificial structures to secure tax advantages that we would normally not be entitled to.
Our headquarter is based in the Netherlands and we are organized centrally. The benefit of this is that we can offer new innovative products often and quickly and that our business set-up is simple and efficient. This enables us to create more value for all our customers and other stakeholders.
Our business set-up is fully driven by commercial considerations and aligned with the business activities that we have. Rituals Cosmetics only has corporate entities outside the Netherlands where we have opened own stores, plan to do so shortly or are active through one of our other lines of business.
Rituals Cosmetics adopts a transfer pricing policy that is in line with OECD guidelines and this policy ensures that profits are taxed where the value generating activities take place. All transactions within the Rituals group take place on commercial terms and on an arm’s length basis to reflect OECD guidelines.
OUR RELATIONSHIP WITH HMRC
Rituals Cosmetics UK Ltd. ensures that it meets it tax compliance obligations and that taxes are paid in a timely matter. Rituals Cosmetics seeks a fair and cooperative relationship with HMRC that is based on mutual transparency and trust. We fully respond to information requests from HMRC and we resolve any differences in a transparent and collaborative matter.
At Rituals Cosmetics, our aim is to be directly in contact with HMRC rather than through professional tax advisors. This way, we can build towards a relationship that is based on mutual trust and understanding of our business.