Premium Credit Tax Strategy Statement

Premium Credit Limited (PCL), the Group’s principal trading subsidiary, provides instalment finance and payments services to almost three million customers in the UK and Ireland via our network of intermediaries.  Strong corporate governance is  critical to maintaining stakeholders’ confidence and as such the Group is committed to complying with UK tax law and practice. Our tax strategy is aligned to our wider business strategic objectives, including creating a strong risk and governance framework that ensures fair outcomes for customers, complies with regulatory requirements and helps our partners to manage their legal requirements. 

Tax risk management and governance

Our tax strategy is owned by the UK Board and the Chief Financial Officer has primary responsibility for tax risk management and governance, which is overseen by the Audit Committee.

Our overarching aim is to minimise any regulatory risk within our business, which includes taking a low risk approach to tax risk. We aim to ensure that our tax arrangements remain consistent with a low risk appetite, both in financial and reputational terms. We are committed to full compliance with our tax obligations. 

The key risks and controls for PCL in the UK are highlighted below:

  • Compliance Risk:  As with all businesses, PCL has the risk that tax returns will not be submitted on a timely or accurate basis. In order to mitigate this risk, PCL have implemented robust internal controls and use external tax advisors to advise on or prepare the UK tax filings.
  • Transaction Risk:  A detailed risk assessment is undertaken for all material business changes (i.e. business change, new products). As part of this assessment, tax risk is assessed by external tax advisors to ensure all tax risks are assessed.
  • Legislative Change Risk:  Legislative tax changes pose risk to our business. To ensure this risk is mitigated, we receive regular updates from our tax advisors and attend industry seminars.
    Tax risk appetite

PCL has a low risk appetite for all business risks, including tax.  As such, PCL is committed to ensuring it complies with not only the letter of the law, but also the intention of parliament, whilst maintaining value for its shareholders. This is achieved by integrating risk management into day to day activities.

Our approach towards tax planning

PCL aims to be efficient with tax planning, including taking advantage of any government tax incentives, such as R&D Tax Credits, in order to maximise value on a sustainable basis for the Group and its shareholders.  However, any structuring that is undertaken must have commercial and economic substance, and PCL does not put in place any arrangements that are contrived or artificial. Where planning is undertaken, we consult external tax advisors to ensure that the tax technical interpretation is fully aligned to our risk appetite.

Relationship with HMRC

In the spirit of cooperative compliance, PCL engage with HMRC in an open and transparent manner.  We do not take positions on tax that may create reputational risk and seek to resolve any disputed matters with HMRC through proactive discussion wherever possible. 

We consider that the above statement complies with PCL’s obligation under para 16(2) and para 25 (1), Sch 19 Finance Act 2016.

Note: This statement applies to all UK incorporated companies, including the principal trading subsidiary Premium Credit Limited, which is based in Leatherhead, UK and is a UK registered and domiciled company. All employees are employed by Premium Credit Limited. Under the HMRC guidance, the above statement does not apply to the securitisation SPV’s, Mizzen Bondco Limited (Cayman Islands) or Pomegranate Holdings Limited and Pomegranate Topco Limited (Jersey