Business risk review

Produced by Tolley
Business risk review

The following Corporation Tax guidance note Produced by Tolley provides comprehensive and up to date tax information covering:

  • Business risk review
  • Business risk review (BRR+)
  • Definition of tax risk
  • The benefits of a low risk status
  • The risk assessment
  • Inherent risks
  • Behavioural risks
  • Risk review follow up
  • Attending the risk meeting with HMRC
  • The risk review process
  • More...

Business risk review (BRR+)

Companies dealt with by the large business (LB) and certain companies dealt with by local compliance (large and complex) (L&C) within HMRC will normally be subject to a BRR+ once a customer compliance manager (CCM) has been appointed, or if a review is requested. The overall aim of the review process is to assess the tax compliance risk profile of a company and categorise it as either low risk, moderate risk, moderate-high risk or high risk.

Once an initial review has been completed, a company will be entered into a cycle of further reviews, the frequency of which depends on the allocated risk status.

The review process will be in reference to all the taxes relevant to the business and an overall rating will also be issued in respect of the business as whole.

HMRC will undertake various research activities, for example reviewing group websites, and will also hold a fact-finding meeting with the company. A collaborative approach is encouraged, with input from tax, audit and other specialists.

A more detailed overview of the BRR+ process can be found at TCRM3100, together with a flowchart summarising the analysis undertaken by HMRC.

Definition of tax risk

When considering risk, gaining certainty about tax outcomes is important to HMRC. HMRC’s definition of a low risk company is, broadly, one that it can trust to:

  1. be open and transparent with HMRC in real time

  2. have systems and processes in place to produce figures for its tax returns which are accurate in all material aspects, and

  3. not get involved in tax planning which does not support genuine commercial activity

TCRM3360

HMRC provides guidance on the benefits (see below) and expectations of obtaining low risk status.

Businesses judged to be low risk will have much greater certainty about their tax position. HMRC sees low risk businesses as driving their own tax agenda and operating on the basis of trust and transparency with their CCM. See the Customer compliance manager guidance note

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