Our approach to tax
At Schroders we are committed to conducting our tax affairs in an open and transparent way. This means that we comply with all of our tax filing, tax reporting and tax payment obligations globally. We also seek to maintain good relationships with the tax authorities in the key jurisdictions in which we operate.
The amount of tax we pay and collect is driven by a number of factors including the locations of our people and clients, and the tax rates and rules in each of the countries in which we operate. Corporate tax rates in particular can vary significantly by country. With this in mind, we apply a consistent global approach to allocating costs and revenues that fairly recognises the economic contribution of each of our businesses. We have a number of minor subsidiaries incorporated in jurisdictions with low or zero tax regimes. These subsidiaries have all been established to undertake genuine business activities relating to the management of investment funds and servicing of clients.
We believe it is important that business behaves responsibly and builds trust within society regarding its role and contribution on tax. With this in mind, we support initiatives to improve international transparency on taxation matters, including OECD measures on country-by-country reporting and automatic exchange of information. We are a signatory to the UK's Code of Practice on Taxation for Banks and are treated as 'low risk' by HMRC.
Our tax strategy sets out our approach to tax matters across the Group more generally. This strategy is reviewed and approved annually by the Audit and Risk Committee.
We have offices in 37 locations including the major financial centres of Europe, the Americas and Asia Pacific. Taxes borne include corporate income taxes, employer related social security, business rates, irrecoverable value added taxes on our expenses and sales taxes.
On average, we paid corporate income tax at a rate of 17.2% in 2022 (2021: 18.4%).
The total taxes borne by the Group in 2022 was £254.5 million (2021: £308.9 million).UK taxes borne (57%)Americas taxes borne (9%)Asia Pacific taxes borne (9%)Europe taxes borne (25%)
UK taxes borne (57%)
Americas taxes borne (9%)
Asia Pacific taxes borne (9%)
Europe taxes borne (25%)
Companies also have an important role in collecting and administering taxes on behalf of governments, where the cost of the tax is borne by others. We collect income taxes, social security, withholding taxes, indirect taxes and other local taxes in the countries in which we have operations.
The total tax collected in 2022 was £320.6 million (2021: £268.8 million).UK taxes collected (66%)Americas taxes collected (12%)Asia Pacific taxes collected (10%)Europe taxes collected (12%)
UK taxes collected (66%)
Americas taxes collected (12%)
Asia Pacific taxes collected (10%)
Europe taxes collected (12%)
Corporate income taxes borne
Employment taxes borne
Indirect taxes borne
Property and other taxes borne
Total taxes borne
Employment taxes collected
Indirect taxes collected
Withholding and other taxes collected
Total taxes collected
Total taxes borne and collected
We are required by law to disclose tax information in our annual report and in respect of certain regulated entities (see below).
Capital Requirements (Country-by-Country Reporting) Regulations 2013