Antalis UK Tax Strategy

In accordance with Schedule 19 paragraph 19(2) of the Finance Act 2016, Antalis sets out below its tax strategy for all UK companies within the Antalis group for the year ending 31 December 2023 and which will be renewed annually.

Background - UK operations

The UK Antalis companies are all indirectly owned subsidiaries of Antalis SAS (France). Since July 2020 Antalis SAS has been wholly owned by KPP Group Holdings Co., Ltd (formerly Kokusai Pulp & Paper Co., Ltd), a company listed on the Tokyo Stock Exchange. KPP Group Holdings Co., Ltd (“KPP Group”) is one of the world’s leading paper distribution groups. As of March 2023, KPP Group operated in 43 countries and regions, and had approximately 5,500 employees worldwide.

The Antalis division of the KPP Group operates throughout Europe and Latin America and is a distributor of paper, packaging and visual communication solutions.

The Antalis UK group comprises the following companies:

Taxes paid and collected by the UK Group

We pay stamp duties, employment and other taxes. We do not currently pay corporate income taxes due to the availability of commercially generated tax losses and capital allowances in the Antalis UK tax group. In addition, the Antalis group collects and pays over both employee taxes and VAT.

1. How the business manages UK tax risk

This document has been approved by the Board of Directors of the Company (the “Board”) and will be reviewed annually. The Board is responsible for determining our approach to tax, with the Finance Director and Senior Accounting Officer (SAO) having specific responsibility for tax matters. Day-to-day operational responsibility for our tax affairs is delegated to the Company’s Financial Controller with the support of professional advisers, where required.

There are several levels of control to limit tax risk and provide governance:

• The Antalis group Code of Business Conduct sets out the integrity expected from employees. This code requires, inter alia, all directors, officers and employees of the Antalis group to “Strictly abide by all applicable laws and regulations” and to “Build and maintain clear, fair, honest and lawful relationships with business partners” (which include governments and government agencies).
• The Senior Accounting Officer (SAO) regime and structure applies to the UK companies and controls are in place to ensure correct tax accounting.
• The tax risk management system is part of our internal control processes. We identify, assess and manage tax risks and account for them appropriately. We implement risk management measures including controls over compliance processes and monitor their effectiveness.
• UK corporation tax computations are prepared by external advisers.
• Diligent professional care and judgement are employed to assess tax risks to arrive at well-reasoned conclusions on how the risks should be managed. Where there is uncertainty as to the application or interpretation of tax law, appropriate written advice evidencing the facts, risks and conclusions may be taken from third party advisers to support the decision-making process.
• The UK Board of Directors are briefed on material tax issues and supports this tax strategy.
• Tax risk is also managed through a conservative attitude to tax planning and open communication with the tax authorities. We strive to have an open and constructive relationship with them.

The inherent risk due to size, complexity and change is mitigated by:

• The UK finance function has close links with the Antalis HQ tax manager in France who closely reviews UK compliance alongside tax in the rest of the Antalis sub-group.
• The UK tax position is reviewed regularly by Antalis HQ as part of quarterly reporting to KPP, forecasting and budgeting.
• The UK finance team is involved with Antalis HQ tax manager in preparation of agreements and documents to ensure compliance with transfer pricing rules.
• Antalis HQ tax manager has access to the latest tax information and uses specialist software to ensure compliance with transfer pricing documentation.

2. Attitude towards tax planning

• Tax planning is used to support the economic and commercial activity of the Antalis group to minimise tax liabilities within the legal framework set by the government. We do not enter into artificial tax planning schemes. There is an obligation to shareholders to optimise tax efficiencies but set within the overriding context of compliance and reputation.
• One of our prime aims when considering tax matters is to minimise the risk of uncertainty and disputes with the tax authorities. Our policy of open and constructive relationships with the tax authorities supports this aim and also, where possible, we seek to agree the tax treatment of transactions in advance.
• Where tax incentives and exemptions are available we seek to apply them in the manner intended.

3. Level of risk in relation to UK taxation acceptable to KPP Group

The Antalis group does not target a particular level of acceptable tax risk. We are committed to managing our tax affairs in a manner compliant with tax legislation to ensure we report and pay the right amount of tax, at the right time. We recognise that, with ever-increasing complexity in the legislation, this requires a pro-active approach to tax management. We seek to apply the law correctly to our transactions and, in so doing, strive to minimise our tax risk. We recognise that tax legislation can be complex and sometimes subject to interpretation. We will, therefore, always take appropriate independent advice where uncertainty arises to reduce any potential risk as far as possible. Where appropriate, we seek clearances and rulings from the relevant tax authorities.

4. Approach towards dealings with HMRC

• The trusted working relationship with HMRC is important to Antalis and the ongoing engagement with the HMRC Customer Compliance Manager is highly valued.
• Open and ongoing dialogue with HMRC ensures transparency and helps to prevent unexpected issues arising for both Antalis and HMRC.

December 2023