Guardian Media Group Tax Strategy 2020

1 Guardian Media Group Tax strategy 2 Guardian Media Group Tax strategy This tax strategy applies across About Guardian Media Group Group strategy and results the Guardian Media Group. This Guardian Media Group is one of the UK’s The Group has continued to implement its document, approved by the leading media organisations. We exist to strategy to build deeper relationships with Executive Board of Guardian support quality, independent and liberal our audience based on their trust in our journalism. Our core business is Guardian Media Group plc sets out the high quality independent journalism which News & Media, one of the world’s leading reflects our editorial purpose and Group’s approach to conducting news publishing organisations. our mission. its tax affairs and dealing with The parent company of the Group is The tax risks for the year ended 29 Scott Trust Ltd, a UK tax resident company, The primary financial goal set for GMG in March 2020. Guardian Media which was established to secure the 2019-20 was for Group adjusted net operating financial and editorial independence of the cash outflows to remain within the range of Group regards the publication Guardian in perpetuity. £25-30m, in line with the expected long term returns from the Scott Trust Endowment of this tax strategy as complying The Group has business operations in Fund. This target has been achieved for the with the duty under paragraph the UK, US and Australia. All companies year with an adjusted net operating cash 16(2) of Schedule 19 of the in the Group are incorporated in these outflow of £29.0m. Finance Act 2016. countries, hold all of the Group’s assets and are fully subject to prevailing tax laws and The Guardian is supported by the Scott Trust regulations. Endowment Fund. The value of the fund The Group also has an endowment fund and other cash holdings stands at £954.2m which exists solely to support and fund (2019: £1,013 m). The modest decline in the our journalism. The endowment fund value of these holdings reflects cash being consists of diversified medium and long transferred from the Endowment Fund to term focused investments managed by a meet operations cash outflows of GNM, plus number of specialist fund managers. The the impact of covid-19 on the value of the investments include global and emerging investments. markets equity, fixed income, hedge funds and private equity and venture capital Our tax position in the year- funds. Whilst the investments are a mixture ended 29 March 2020 of UK and non-UK assets, they are all held by UK tax resident companies in the Group The Group is committed to reporting on its which are fully subject to UK tax laws and tax position in a transparent manner and regulations on all of the income and realised makes extensive disclosures relating to tax in gains arising from all of the investments held. its annual financial statements. An abridged version of the disclosures for the year-ended Our values 29 March 2020 detailing the corporation tax position of the Group is included as an CP Scott, the famous Manchester Guardian Appendix to this document. editor, outlined the paper’s principles in his celebrated centenary leader on May 5, The Group’s business operations in the UK, 1921. The much-quoted article is still used US and Australia have historically been to explain the values of the present-day loss making. These historic losses were newspaper, Trust and Group. The values he legitimately used to offset taxable profits and described are: honesty; cleanness (today gains that arose in the year which meant that interpreted as integrity); courage; fairness; the Group paid no Corporation Tax in the year and a sense of duty to the reader and ended 29 March 2020. the community. The Group collects and pays indirect and payroll taxes in the countries in which it operates. In 2019-20, the Group collected and paid £33.8 million of income taxes and social security associated with its employees. 3 Guardian Media Group Tax strategy Our tax strategy Our approach to governance of complying with all relevant laws and regulations and preventing and reducing tax Our tax strategy seeks to enable and support arrangements and risk disputes and uncertainty. the Group’s business strategy by managing management tax risks and costs in a manner consistent This is achieved by maintaining documented with The Scott Trust values. Governance arrangements policies and procedures in relation to tax risk management and maintaining open Our tax strategy consists of four key The Guardian Media Group plc Board and constructive relationships with principles: approves the Group’s tax strategy. tax authorities. From an operational perspective, the Audit Committee, made up primarily of 1. We manage our tax affairs in a manner independent non-executive directors, is Our attitude towards tax consistent with the values of The Scott considered to be the supervisory body for all planning Trust and the organisation’s purpose Group tax activities and monitors on-going Our attitude to tax planning is governed by to secure the financial and editorial compliance with the tax strategy. the four key strategic principles detailed independence of the Guardian in above in the ‘Our tax strategy’ section. perpetuity and to support journalistic The Director of Finance and Tax is responsible The Group may engage in tax planning freedom and liberal values. for ensuring that appropriate procedures and guidelines are established, and suitable in order to manage its tax costs and an 2. We seek to act lawfully and with integrity training and education provided to support assessment of the appropriateness of doing so when managing our tax affairs by paying the four strategic principles detailed above. is made against all four principles to ensure they are adhered to. and collecting tax in accordance with The Director of Finance and Tax meets all relevant laws and regulations in the regularly with the Chief Financial Officer to External tax advice is taken from time to time countries in which we operate. If we discuss tax matters as they arise including where clarification of the tax implications of discover instances of non-compliance we the impact of the introduction of new tax the Group’s activities is required. seek to resolve them with the appropriate legislation on the group, the tax implications tax authority. of changes to the group’s operations and the Our approach towards our 3. We only engage in reasonable and outcomes of tax risk management reviews. dealings with HMRC sustainable tax planning that is aligned The Director of Finance and Tax reports at A constructive relationship with HMRC is with commercial and economic activity. least annually to the Audit Committee on the important in the operation of the Group’s tax This means: tax position of the group and the on-going strategy. adherence to the tax strategy. ▶ We do not enter into artificial tax We engage in an open and transparent way with HMRC to allow them to fully understand arrangements; Risk management our tax affairs. Where appropriate we engage ▶ We only respond to tax incentives and Tax risks can arise as a result of changes in with them on a timely basis and seek advance exemptions in the manner in which they tax legislation and changes to the Group’s clearance, either formally or informally, were intended; and underlying operating model, systems and on the tax implications of a transaction or a ▶ All transactions between Group processes. The Director of Finance and Tax change to our business. companies are carried out on an arms- is responsible for ensuring that the Group’s We have a track record of pro-actively length basis. tax position and tax risk management bringing tax issues in our business to the procedures are regularly reviewed to enable 4. We are open and transparent with tax attention of HMRC and collaboratively the appropriate management of tax risk. authorities and provide all relevant and working with them to resolve these as quickly reasonable information that is necessary The tax function actively assesses and as possible. for them to fully understand our tax monitors UK tax risk throughout the year affairs. by maintaining a detailed tax risk register, Criminal Finances Act 2017 which documents the processes and controls We ensure suitable policies and procedures implemented to mitigate the risks. The tax are in place to prevent or minimise the risk risk register is reviewed regularly during of our employees, agents, suppliers or other the year to ensure its completeness and to third parties associated with us facilitating check the effectiveness of the processes tax evasion as reflected in the Criminal and controls. The outcomes of the reviews Finances Act 2017. are discussed with the Chief Financial Officer and, where issues are identified, new We will undertake, and periodically processes and controls are designed and refresh, a risk-based assessment of our implemented. business activities to identify such risks and ensure procedures are adequate. We will The level of risk in relation to UK communicate the policy and ensure adequate taxation that we are prepared to training is provided. accept The Group has a low appetite for tax risk and manages its tax affairs accordingly. Whilst standardised, acceptable levels of tax risk are not formally documented or quantified, tax risk is primarily managed with the aim 4 Guardian Media Group Tax strategy Appendix 1. Corporate tax charge 2020 (£ m) Corporate tax charge Abridged tax disclosures Corporate tax charged in the income statement: 0.6 in the Guardian Media Corporate tax charge 0.6 Group plc financial statements for the year 2.

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