Thames Water has today published its first “Our taxes explained”, a document designed to fulfil its commitment to being open and honest with customers, and to explain its taxes in a simple, understandable way.
In 2016/17, Thames Water paid over £170 million in business rates, PAYE and national insurance contributions, which help fund vital public services for the community.
As the country’s largest and oldest water and wastewater services provider, Thames Water continues to invest in its essential and ageing infrastructure for the benefit of current customers and future generations – over £1 billion was invested in 2016/17, the equivalent of £20 million a week. It has also committed to spending an additional £97 million to replace some of its large ‘trunk’ water mains before 2020 on top of over £4 billion it plans to invest in the business during the 2015 - 2020 regulatory period. Under the Government’s capital allowances scheme, which helps companies invest in critical UK infrastructure, Thames Water’s payment of its corporation tax is delayed while it invests so heavily to improve its vast network.
Tax transparency is a cornerstone in building trust - Thames Water has been doing a great deal of work with its stakeholders in recent years to improve its dialogue on tax. In 2016/17, HMRC classified the company as low risk.
Brandon Rennet, Chief Financial Officer, Thames Water said: “Due to the size of Thames Water and the amount we’re investing in our business – over £12 billion in the last 12 years – our taxes can appear complex. We want to be as transparent as possible with our tax affairs, so our customers and other stakeholders can fully understand our position. We take pride in managing our taxes appropriately and efficiently within both the letter and the spirit of tax legislation, for the benefit of our customers, shareholders and the environment.”
Thames Water is committed to being a good corporate citizen and its tax strategy adopts the following five principles:
- To comply with all tax legislation requirements at all times, both within the letter and spirit of the law
- Not to use tax avoidance schemes or aggressive tax planning
- To engage fully and transparently with HMRC and other Government bodies, and to seek to resolve disputes in a co-operative manner
- To adopt a conservative approach to tax risk management and apply a strong tax governance framework
- To accept only a low level of risk in relation to taxation
"Our taxes explained” can be found here.