Criminal Facilitation of Tax Evasion Policy

1. Policy statement

1.1 The 菜肱郭創利 Group, including its overseas activities, (“the University”) is dedicated to conducting its academic, administrative and commercial operations in an honest, law-abiding and ethical manner. The University takes a zero-tolerance approach to the facilitation of tax evasion, whether under UK law or under the law of any foreign country, and will not tolerate acts of criminal facilitation of tax evasion by its staff, subcontractors or any other of its associates anywhere in the world. It is committed to acting professionally, fairly and with integrity in all of its dealings and relationships wherever it operates, and to implementing and enforcing effective systems to counter tax evasion facilitation.

1.2 The University takes its legal responsibilities very seriously. It will uphold all laws relevant to countering tax evasion in all the jurisdictions in which it operates, including the Criminal Finances Act 2017.

2. About this policy

2.1 The purpose of this policy is to:

(a) set out the University’s responsibilities, and the responsibilities of those working for it, whether as an officer, employee, worker, subcontractor, agent or in any other capacity, in observing and upholding its position on preventing the criminal facilitation of tax evasion; and

(b) provide information and guidance to those working for the University on how to recognise and avoid tax evasion.

2.2 This policy applies alongside the University’s Financial Regulations, Anti-Bribery and Corruption Policy and Fraud Policy.

2.3 This policy does not form part of any contract of employment or other contract to provide services, and the University may amend it at any time.

3. Who does this policy apply to?

3.1 This policy applies to all persons working for the University or on its behalf in any capacity, including employees at all levels, directors, officers, agency workers, seconded workers, volunteers, interns, agents, contractors, external consultants, third-party representatives and business partners, sponsors, or any other person associated with the University, wherever located.

3.2 In this policy, third party means any individual or organisation that an individual comes into contact with during the course of their work for the University, and includes actual and potential clients, customers, suppliers, distributors, business contacts, agents, advisers, and government and public bodies, including their advisers, representatives and officials, politicians, and political parties.

4. Who is responsible for the policy?

4.1 The University Executive Board has overall responsibility for the effective operation of this policy but has delegated responsibility for overseeing its implementation to the Director of Finance. General queries regarding this policy, the Criminal Finances Act 2017 should be directed to the Director of Finance or to the Tax Team at vat@reading.ac.uk in the first instance.

5. Tax Evasion Facilitation

5.1 It is an offence for an individual to facilitate tax evasion (as defined and set out in Annex 1).

5.2 Under Part 3 of the Criminal Finances Act 2017, a separate corporate criminal offence of failure to prevent facilitation of tax evasion (the “corporate offence”) will be automatically committed if the University fails to prevent its associated persons facilitating tax evasion, unless it can demonstrate that it had reasonable procedures in place to prevent that facilitation. The University, if found guilty of this offence, could face criminal sanctions including an unlimited fine, as well as exclusion from tendering for public contracts and damage to its reputation.

Examples of situations where Associated Persons could be considered to be assisting Third Parties to commit criminal tax evasion can be found in Annex 1 attached to this document.

5.3 In this policy, all references to tax include National Insurance contributions (and their equivalents in any non-UK jurisdiction).

6. Identifying risks of tax evasion facilitation

6.1 The University has reviewed its risks and associated processes and procedures to ensure that all appropriate steps are taken to prevent facilitation of tax evasion. It maintains a register of possible risks of facilitation of tax evasion by its Associated Persons, as well as listing controls to mitigate those risks, and any actions required to improve those controls. This register will be regularly reviewed and updated, as and when required.

7. What Associated Persons must not do

7.1 It is not acceptable for Associated Persons (or someone on their behalf) to:

(a) engage in any form of facilitating tax evasion or foreign tax evasion;

(b) aid, abet, counsel or procure the commission of a tax evasion offence or foreign tax evasion offence by another person;

(c) fail to promptly report any request or demand from any third party to facilitate the fraudulent evasion of tax (whether UK tax or tax in a foreign country), or any suspected fraudulent evasion of tax (whether UK tax or tax in a foreign country) by another person, in accordance with this policy

(d) engage in any other activity that might lead to a breach of this policy; or

(e) threaten or retaliate against another individual who has refused to commit a tax evasion offence or a foreign tax evasion offence or who has raised concerns under this policy.

8. Associated Persons responsibilities

8.1 Associated Persons must ensure that they read, understand and comply with this policy.

8.2 The prevention, detection and reporting of tax evasion and foreign tax evasion are the responsibility of all those working for the University or under the University’s control. Associated Persons are required to avoid any activity that might lead to, or suggest, a breach of this policy.

8.3 Associated Persons must notify

Their line manager (for employees)
Their contact at the University (for all other Associated Persons)
A member of the tax team (vat@reading.ac.uk)
The Director of Finance
The Chief Legal Officer

as soon as possible if they believe or suspect that a conflict with this policy has occurred, or may occur in the future.

9. How to raise a concern

9.1 Associated Persons are encouraged to raise concerns about any issue or suspicion of tax evasion or foreign tax evasion at the earliest possible stage.

9.2 Should Associated Persons become aware of any fraudulent evasion of tax (whether UK tax or tax in a foreign country) by another person in the course of their work, or are asked to assist another person in their fraudulent evasion of tax (whether directly or indirectly), or if they believe or suspect that any fraudulent evasion of tax has occurred or may occur, whether in respect to UK tax or tax in a foreign country, they must report it to:

Their line manager (for employees)
Their contact at the University (for all other Associated Persons)
A member of the Tax team (vat@reading.ac.uk)
The Director of Finance
The Chief Legal Officer

Employees may also raise concerns under the whistleblowing procedures as set out in the University’s Public Interest Disclosure Policy.

9.3 If Associated Persons are unsure about whether a particular act constitutes tax evasion or foreign tax evasion, they should raise it with

Their line manager (for employees)
Their contact at the University (for all other Associated Persons)
A member of the Tax team (vat@reading.ac.uk)
The Director of Finance
The Chief Legal Officer

as soon as possible. The corporate offence is only committed where an individual deliberately and dishonestly takes action to facilitate the tax evasion or foreign tax evasion. If that individual does not take that action, then the offence is not made out. However, a deliberate failure to report suspected tax evasion or foreign tax evasion, or ignoring suspicious activity, could amount to criminal facilitation of tax evasion.

10. Protection

10.1 Individuals who raise concerns or report another's wrongdoing are sometimes worried about facing possible repercussions. The University aims to encourage openness and will support anyone who raises genuine concerns in good faith under this policy, even if they turn out to be mistaken.

10.2 The University is committed to ensuring no one suffers any detrimental treatment as a result of:

(a) refusing to take part in, be concerned in or facilitate tax evasion or foreign tax evasion by another person;

(b) refusing to aid, abet, counsel or procure the commission of a tax evasion offence or a foreign tax evasion offence by another person; or

(c) reporting in good faith their suspicion that an actual or potential tax evasion offence or foreign tax evasion offence has taken place, or may take place in the future.

Detrimental treatment includes dismissal, disciplinary action, threats or other unfavourable treatment connected with raising a concern. If an individual believes that they have suffered any of this treatment, they should inform

Their line manager (for employees)
A HR Partner (for employees)
Their contact at the University (for all other Associated Persons)

immediately. If none of these contacts are appropriate, they should inform the Chief Legal Officer immediately.

10.3 If the matter is not remedied, and the individual is an employee, they should raise it formally using our Grievance Procedure.

11. Training and communication

11.1 Training on this policy forms part of the induction process for all individuals who work for the University , and regular training will be provided as necessary. That training may form part of wider financial crime detection and prevention training.

11.2 The University ensures that training on this policy is offered to those employees, workers and associated persons who have been identified as being at risk of exposure to criminal tax evasion.

11.3 Our zero-tolerance approach to tax evasion and foreign tax evasion must be communicated to all suppliers, contractors and business partners at the outset of our business relationship with them and as appropriate after that.

12. Publication of Guidance

12.1 The University regularly reviews guidance and legislation in relation to CFA 2017 to ensure it is maintaining an appropriate CFA 2017 policy. Within that review, it will consider appropriate training for employees.

13. Breaches of this policy

13.1 Any employee who breaches this policy may face disciplinary action, which could result in dismissal for misconduct or gross misconduct.

13.2 The University may terminate its relationship with other individuals and organisations working on its behalf if they breach this policy.

14. Potential risk scenarios: "red flags"

The following is a list of possible red flags that may arise during the course of working for the University and which may raise concerns related to tax evasion or foreign tax evasion. The list is not intended to be exhaustive and is for illustrative purposes only.

If an Associated Person encounters any of these red flags while working for the University, they must report them promptly to:

Their line manager (for employees)
Their contact at the University (for all other Associated Persons)
A member of the Tax team (vat@reading.ac.uk)
The Director of Finance
The Chief Legal Officer

or by the procedure set out in the Whistleblowing policy:

(a) An Associated Person becomes aware, in the course of their work, that a third party has:

(i) made or intends to make a false statement relating to tax;

(ii) failed to disclose income or gains to, or to register with, HMRC (or the equivalent authority in any relevant non-UK jurisdiction);

(iii) delivered or intends to deliver a false document relating to tax; or

(iv) set up or intends to set up a structure to try to hide income, gains or assets from a tax authority.

(b) An Associated Person becomes aware, in the course of your work, that a third party has deliberately failed to register for VAT (or the equivalent tax in any relevant non-UK jurisdiction) or failed to account for VAT;

(c) a third-party requests payment in cash or refuses to sign a formal commission or fee agreement, or to provide an invoice or receipt for a payment made;

(d) An Associated Person becomes aware, in the course of their work, that a third party working for the University as an employee asks to be treated as a self-employed contractor, but without any material changes to their working conditions;

(e) a supplier or other subcontractor is paid gross when they should have been paid net, under a scheme such as the Construction Industry Scheme;

(f) a third party requests that payment is made to a country or geographic location different from where the third party resides or conducts business;

(g) a third party to whom the University has provided services requests that their invoice is addressed to a different entity, where the University did not provide services to that entity directly;

(h) a third party to whom the University has provided services asks the University to change the description of services rendered on an invoice in a way that seems designed to obscure the nature of the services provided;

(i) An Associated Person receives an invoice from a third party that appears to be non-standard or