Flowserve UK Tax Strategy
In compliance with the requirements outlined in paragraph 19(2), Schedule 19 of UK Finance Act 2016, Flowserve Corporation publishes this statement on behalf of its UK companies, which include:
- Flowserve International Ltd
- Flowserve GB Ltd
- Sterling Fluid Systems (UK) Ltd
- Sterling Fluid Services Ltd
- Sterling Fluid Services (UK Group) Ltd
- Audco Ltd
This annual statement is effective for Flowserve’s year ended December 31, 2017.
Risk Management & Governance
We proactively manage tax issues and risks while maintaining a tax rate in compliance with UK tax laws and regulations. Flowserve maintains internal policies and procedures to support its tax control framework and employs professionals that are experienced in identification and management of tax risk with additional support provided through ongoing training and input of external advisors when appropriate. The Audit Committee monitors the integrity of financial reporting, internal controls and key risks, including elements related to taxation. The Vice President, Tax and CFO regularly report on tax affairs and risks to the Audit Committee.
Tax Planning and Risk
Flowserve only engages in tax planning that is aligned with its commercial business activities of the company and that is in compliance with UK tax rules, OECD guidelines and arm’s length principles. Any business related tax planning that we engage in is consistent with the principles set forth in Flowserve’s Code of Conduct, which guides our corporate culture and defines our ethical values. We primarily utilize independent reputable firms who are not our auditor to help us evaluate the tax implications and risks related to potential transactions. Flowserve has a strong history of compliance and is committed to paying the correct amount of tax due. Flowserve believes it is our responsibility as a corporate citizen to pay our fair share of taxes, including corporate income taxes, employment taxes, social contributions, property taxes, import and customs duties, and indirect taxes.
Relationship with Her Majesty’s Revenue & Customs (HMRC)
Flowserve is committed to the principles of openness and transparency with tax authorities. We endeavor to operate with consistently high accounting, tax filing and tax reporting standards. We value transparency and cooperation with tax authorities, and are committed to engaging with the tax authorities in a professional, courteous, honest and collaborative manner regarding all tax matters. We recognize that there could be areas of differing legal interpretations between the Company and HMRC and if this occurs we will engage in proactive discussion to bring matters to as rapid a conclusion as possible.