From discussions with clients and our experience in the industry, we have concluded that the most pressing issues that financial institutions can potentially face include:
- transfer pricing
- indirect tax
- cross-border taxation
- complex tax challenges associated with mergers and acquisitions
To manage all these challenges, we can assist Banks and other Financial Institutions with the following services:
1. Business Tax advisory
KPMG experts can put Banks and other Financial institutions on the right track by establishing an internal process to be followed within the business and/or by acting as the Tax SME. KPMG provides advice on the tax implications of various operations the bank performs, this is achieved through:
- New and periodic product reviews, which covers all key lines of business (i.e. Retail Banking, Wholesale Banking, and Global Markets)
- Cross-border deal review
- Tax transparency review including revenue recognition and economic substance
2. Transfer Pricing Requirements
More than 60 countries around the world have TP regulations which have stringent documentation requirements and levy penalties for incorrect application of rules. All TP regulations are built on the underlying principle of the arm’s length standard, which stipulates that the price charged on related party transactions must be similar to the price that would be charged by unrelated parties for comparable transactions. Explore our range of Transfer Pricing services using the navigation menu to the left of this page.
3. Tax Risk Management
Establishing a Tax Strategy is the starting point for defining the Tax Risk Appetite of the firm and the main tax risks categories. Risk identification and reporting tools are important for flagging tax risks to management and identifying the key remediation processes to manage the risks. Establishing the three lines of defense risk management model is important and requires active support of the organization’s governing body and senior management.
4. Tax Reimagined: Tax is changing. We are changing Tax
We understand tax transformation and we can help our clients reimagine and transform their tax function. Tax Reimagined is a technology-enabled holistic approach to developing a future state target operating model for the client’s tax and statutory function. Explore our range of Tax Reimagined services using the navigation menu to the left of this page.
5. AEOI Services Heath Check and Risk Framework
KPMG have developed two solutions to help financial institutions navigate this complex and changing environment. KPMG AEOI Health Check is a detailed review of processes and procedures to help ensure compliance with both the Foreign Account Tax Compliance Act (FATCA) and the Common Reporting Standard (CRS) and identify any gaps. The complementary KPMG Risk Framework helps to establish ongoing controls and compliance.
6. Tax Transparency (Client Tax Evasion Risk)
Tax Evasion is a financial crime and is deliberate, which is why a distinction should be made and well understood between Tax evasion, Tax Avoidance, and Tax Planning.
KPMG can help banks with:
- Reviewing and enhancing the Customer Due Diligence “CDD” process
- Identifying clients’ behavior indicating concealment (e.g. unexplained source of funds, indications of dishonesty)
- Identifying individual or corporate risk factors (e.g. lack of transparency around the company’s structure, high risk jurisdictions involved, complicated corporate structures)
- Identifying factors that might mitigate the risk of tax evasion
- Enhancing the awareness of front-line bank staff, relationship managers, and compliance teams.
7. Family Office and Private Clients
KPMG partners with Banks/FS to provide tax services to Ultra-High-Net-Worth clients. The services to UHNWI will differ from one client to another based on their investment profile and needs. Explore our range of FO&PC services using the navigation menu to the left of this page.
8. General Tax, Zakat and VAT Compliance
We provide a full-fledged and comprehensive package of Tax compliance services. Explore our range of Domestic Corp. Tax services using the navigation menu to the left of this page.
9. Indirect Tax
We provide a full-fledged and comprehensive package of Indirect Tax services. Explore our range of these services using the navigation menu to the left of this page.
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