TCRM3100 - The Business Risk Review (BRR+): Overview

The Business Risk Review (BRR+) is the process by which we evaluate and discuss with the customer where we think they sit on the compliance spectrum and in particular whether they meet the criteria for low risk. It is based on the principle that, while factors such as the size and complexity of a business create their own risks and can make it more challenging for customers to comply with their tax obligations, even the largest and most complex businesses can be classified as low risk if they mitigate these risks to an acceptable level through their behaviours. The results of the BRR+ inform both our overall approach to a customer and the focus of any future risk assessment activity.

The BRR+ will take place at least annually for customers who are not low risk. For low risk customers a BRR+ will, in general, be carried out on a three year cycle.

The BRR+ process involves the following steps:

  • considering the landscape in which the business operates, and it's potential impact on the inherent level of tax compliance risk the customer presents
  • for each applicable tax regime, considering the effect of the customer’s behaviour on this inherent risk - does their relationship with HMRC, their systems and processes, internal governance and their approach to tax compliance tend to increase or decrease this inherent risk
  • considering the overall risk rating of the business
  • agreeing the customer’s overall risk status
  • agreeing any action required to reduce the level of risk

The process is explained below

Tax Specialist


1. Consider the Customer’s behaviour in terms of systems and delivery, internal governance and approach to tax compliance.

2. Assess the customer against the behavioural risk criteria.

3. Record the regime marking on the BRR+ template and record your comments in the relevant boxes. Ensure you maintain supporting evidence for audit trail purposes.

CCM   


1. Consider the business landscape in terms of size, complexity and the degree of change. Remember, under BRR+, business landscape is not given a risk rating. Record the information on the BRR+ Template.

2. Consider each of the tax regime ratings and the summary for systems and delivery, internal governance and approach to tax compliance. In considering each regime risk rating, assess the customer’s overall Risk Status (low risk, moderate risk, moderate - high risk or high risk). Record the overall marking for each of the behavioural risk factors and the overall risk rating with supporting comments on the BRR+ Template. Ensure you maintain supporting evidence for audit trail purposes.

3. Agree work to be taken forward and action(s) required to reduce risk, recording this on the BRR+ Template.

4. Record the customer comments on the BRR+ Template.