Tax Strategy | First Abu Dhabi Bank (FAB)

UK Tax Strategy

The First Abu Dhabi Bank P.J.S.C. (“Group” or “Bank”) including its London branch, Group Tax Strategy conforms in accordance with paragraph 22(2), Schedule 19 of Finance Act 2016.

The Group is headquartered in the United Arab Emirates (“UAE”), and in particular, in the Emirate of Abu Dhabi. The Group is seen as the largest in the region on a number of metrics, and carries out its responsibilities accordingly. The UAE introduced a Value Added Tax in January 2018 at a federal level, while each Emirate exercises its own Decree to manage the introduction of Corporation and other taxes.

In the UK we have adopted the HMRC’s Code of Practice for the Taxation of Banks and continue to be supportive of global initiatives to improve tax transarency.

Governance

The Group has an established Tax framework to which it adheres to. For ease of reference, the Framework is set out in the Appendix to the Strategy document. Leading from the Framework are governing principles and policies embedded within the wider Group organisation.

The London branch is aligned on its SAO responsibilities and obligations thereunder. While the Group has a Tax function comprising of adequately qualified staff to manage the tax affairs of such a Group, it leverages the wider Finance function in each geographical location in which it operates with sufficient support from local external professional advisors to manage its tax affairs. All tax compliance and reporting requirements are the responsibility of local Finance functions, and any advisory or governance issues are responsibility of the Group tax function.

Planning

All business transactions, products, client relationships, and counter-parties are purely driven by commercial and business needs. Accordingly, any tax outcome is consequential. Tax review and / or due diligence on business transactions and commercial matters are conducted to identify documentation requirements, tax indemnities and warranties provided (or required) by the Group, and where a choice of [tax] outcome is available to opine on the most suitable outcome in relation to the proposal.

The Bank in the normal course of its business does not provide any tax advice or direction to its clients, counter-parties, or to third party agents and allows for the normal tax outcome. Accordingly, any tax planning undertaken by the Group whether on its own corporate affairs, financial and economic products, or other transactions, is limited to choosing only an optimal outcome where a choice of outcomes is available. The absence of specific Tax planning in the Framework, including dedicated personnel to this attribute, is testament to this.

Risk

The Group intent is to pay its fair share of taxation in all the jurisdictions it operates in, and is mindful of its commitments to the wider environment including, its obligtion as a good corporate citizen.

The Group manages its tax risk within the wider Risk Framework and policies of the Group; it has no appetite for unnnecessary [Tax] risks either planned or consequential. All [tax] risks are captured within the Group’s operating model and each business manages its own tax risk matrix with proper engagement with Group Tax, including use of professional advisors through the Group tax function.

Dealing with HMRC

A periodic dialogue is undetaken with the Tax authority in each of the jurisdictions in which the Group operates and there is at least an annual meeting with each local Authority during which an open and transparent dialogue takes place.

Within the UK the two key persons responsible for contact with HMRC are the Group Head of Taxation and the UK CFO supported by local professional tax advisors.

The Group remains open to all tax dialogues with its stakeholders. It is also committed to delivering on its strategy, and in doing so, attracting and developing talented individuals.