Shell’s approach to tax

We are committed to compliance. We seek to comply with the letter and the spirit of the tax laws wherever we have a taxable presence and expect to pay tax on profits where the business activity took place. When available and appropriate, we use tax incentives and exemptions.

We seek to resolve any uncertainty in the interpretation of the tax laws directly with tax authorities, including through advance tax agreements. We may also seek a co-operative compliance approach, which involves regularly and proactively engaging with tax authorities and providing them with real-time information before filing the tax return.

These arrangements offer an opportunity for early resolution, minimising the risk of future disputes. Where necessary, we will seek a clear resolution through the judicial system to test the legal principle of the tax law concerned.

Our tax and finance staff supported the filing of around 43,000 tax returns in 2020. We aim to adhere to international best practices and aim for accuracy and timeliness when we fulfil our tax filing obligations.

Our tax control framework, policies and guidelines set out the standards, controls, risk management and assurance that establish boundaries for our tax activities. Our tax control framework also sets out practical guidance for our staff, including the procedures for considering tax risks. Our tax and data systems evolve continuously to deal with the growing demand for information from authorities. External auditors regularly review our tax controls as part of the audit of our financial results.

We do not condone, encourage or support tax evasion. Compliance is embedded in the Shell General Business Principles and the Code of Conduct. Employees, contract staff and third parties with which Shell has a business relationship may raise ethical and compliance concerns, anonymously if preferred, through the Shell Global Helpline.

We regularly monitor relevant changes and developments in tax systems. We review our corporate and financing structures to confirm that our presence in all countries, including low-tax jurisdictions, is grounded in substantive and commercial reasons.

Shell may seek the support of an external adviser where specialist technical expertise is required that is not available within Shell or where additional resources are required.

We strive for an open dialogue on tax matters with governments, policymakers, businesses, investors, and civil society. Since 2003, we have taken important steps to be more transparent about the taxes we pay.

Our participation in the development of the B Team Responsible Tax Principles reflects our ambition to align our tax strategy more closely with emerging best practice. Our Tax Contribution Report and future publications aim to demonstrate how we are applying our Responsible Tax Principles.

We welcome the opportunity to work with others in areas of shared interest. Our approach to tax considers the interests of relevant stakeholders. Through engagement with thought leaders, other companies, investors and civil society, we stay informed of developments that may impact our business.

We also regularly engage with policymakers to support the development of tax rules and regulations based on sound tax policy principles. In this way, we hope to contribute to the development of fair, effective and stable tax systems.

We also provide constructive input to industry groups and international organisations, such as the Extractive Industries Transparency Initiative (EITI), the B Team Responsible Tax Working Group (B Team) and Business at OECD, an international business network.