Tax policy

Tax risk management is carried out by the board, management and relevant staff of the Carlsberg Foundation and the Carlsberg Group.

Compliance with the Carlsberg Foundation’s tax policy is overseen annually by the foundation’s board, and all are welcome to contact the foundation directly with enquiries about its tax affairs and comments on its compliance with tax rules.

Tax risk management includes risk assessments before undertaking any tax planning around significant transactions, and the Carlsberg Foundation draws on external advisors in cases where relevant expertise is not available internally. External advisors are also consulted on significant transactions and decisions where tax considerations play a key role or where there is material uncertainty about the interpretation of existing laws and regulations.

The Carlsberg Foundation and the Carlsberg Group aim to comply with the tax legislation of relevant geographical territories and to pay the right amount of tax at the right time where we create value, based on relevant interpretations of applicable law and the substance of our economic and commercial activities.

We prepare and file tax returns as required, providing complete, accurate and timely disclosures to all relevant revenue authorities. Where tax law is unclear or subject to interpretation, we evaluate the likelihood, and where appropriate seek an external opinion to ensure, that our position would be upheld.

We apply the arm’s length principle in line with best-practice guidelines issued by the OECD and apply this consistently (contingent on local laws).

We establish business structures that are driven by a sound commercial rationale, are aligned with our activities and have substance. We do not seek to gain excessive tax advantages.

A list of all group entities can be found in the annual report for the Carlsberg Foundation and the Carlsberg Group.

We do not establish companies in so-called tax havens in order to avoid taxes on activities which take place elsewhere. Entities which are based in low or nil-rate tax jurisdictions exist for substantive and commercial reasons.

We seek, wherever possible, to develop cooperative relationships with tax authorities based on mutual respect, transparency and trust, and we follow established procedures and channels for our dealings with tax authorities, government officials, ministers and other third parties in a professional, courteous and timely manner.

We are open and transparent with tax authorities, responding to relevant tax authority enquiries in a straightforward and timely manner (providing information concerning other jurisdictions where relevant) to assist in the evaluation of tax liability.

We seek to enter an early dialogue with tax authorities, wherever possible, where there is significant uncertainty about tax rules. Any ruling from tax authorities to confirm an applicable tax treatment is based on disclosure of all relevant facts and circumstances. Where there are misunderstandings of fact or law, we seek to work with tax authorities, and where possible, to identify the issues and explore options to resolve any misunderstandings or disagreements. We will not bribe or otherwise induce tax officials, government officials or ministers with the aim of obtaining more beneficial tax treatment.

Where we claim tax incentives offered by government authorities, we seek to ensure that they are transparent and consistent with statutory or regulatory frameworks and implemented in the manner intended by the relevant statutory, regulatory or administrative framework.

We engage nationally and internationally in constructive dialogue with governments, business groups and civil society to support the development of effective tax systems, legislation and administration.

We provide regular information to stakeholders, including investors, policy makers, employees, civil society and the public, about our approach to tax and taxes paid.

Our approach to transparency includes:

• Publication of the tax policy approved by the board of the Carlsberg Foundation and the Carlsberg Group.
  
  
• An overview of our group structure and a list of all entities, included in the annual report for the foundation and the Carlsberg Group.
  
  
• Annual information on our overall effective tax rate and information on the taxes we have paid.

The Carlsberg Foundation’s tax policy relates to all activities controlled by the board of the foundation. When presenting the foundation’s tax policy, it is relevant to look at the application of the policy to the following:

• Exercising engaged ownership through a holding of shares representing the majority of votes in Carlsberg A/S.
  
  
• Managing the activities of the Carlsberg Foundation, including:
  • investment of the foundation's capital until funds are disbursed
  • disbursement of funds in accordance with the Carlsberg Foundation's charter.

The Carlsberg Foundation is the principal shareholder in Carlsberg A/S, and the foundation exercises engaged ownership of the Carlsberg Group, working to maintain high standards of brewing and give back to society by supporting the natural and social sciences, the humanities, the arts and civil society through grants and donations. Carlsberg A/S is listed on the NASDAQ OMX Copenhagen stock exchange.

The Carlsberg Foundation’s tax policy was discussed as part of the preparation of the tax policy for the Carlsberg Group. The Carlsberg Group’s tax policy is adopted by its supervisory board and is presented in a separate document setting out the tax policy for the global activities of the Carlsberg Group.

The monitoring of compliance with the Carlsberg Group’s tax policy and risk assessment and the management of tax risks in the Carlsberg Group are handled by the management of the Carlsberg Group.

The Carlsberg Foundation invests its available funds – capital not tied up in shares in the Carlsberg Group under the foundation’s charter – to earn interest, dividends or other returns in order to increase the amount available for future grants and donations in accordance with the foundation’s charter and maintain a majority of the votes in the Carlsberg Group.

When investing its available funds, the foundation recognises both the importance of tax as a key factor in achieving the UN’s Sustainable Development Goals and the importance of responsible tax practices.

The Carlsberg Foundation invests in all material respects through external asset managers who are informed of our tax policy. These managers agree to use their best efforts to ensure compliance with applicable tax laws and regulations in the jurisdictions where investments are made, taking account of developments in tax legislation and international initiatives.

The Carlsberg Foundation expects efficient management of investments and encourages managers to consider opportunities for tax planning to prevent double taxation and maximise the after-tax return. However, the foundation urges managers to carefully consider such planning and only to undertake non-aggressive tax planning that aims to ensure fair competition and avoid double taxation.

The Carlsberg Foundation supports increased transparency and international initiatives implemented at OECD and EU level to increase transparency. In line with these principles, the foundation expect managers also to support these initiatives by exercising caution when investing in portfolio companies and by not investing in intermediary holding companies incorporated or tax-resident in (a) jurisdictions deemed “non-compliant” following peer review under the OECD’s Global Forum on Transparency and Exchange of Information for Tax Purposes at the time of the investment, or (b) jurisdictions listed on the EU’s list of non-cooperative tax jurisdictions at the time of the investment.

The foundation expects managers to be transparent in their approach to tax and engage willingly in dialogue with the foundation and society in general.

The Carlsberg Foundation receives dividends on its shares in Carlsberg A/S. These dividends have been taxed in the Carlsberg Group, as they derive from income that has been taxed under the ordinary rules on corporate taxation and after the payment of value-added tax and other taxes and duties paid by the Carlsberg Group.

The dividends received by the foundation are, as a rule, tax-free. The foundation’s other income is taxed in the usual way.

Under the Danish Foundation Tax Act, foundations may offset charitable grants and donations against their taxable income to the extent that these grants and donations exceed the tax-free dividends received.

Charitable grants and donations paid generally count as taxable income for the recipient.

This means that the Carlsberg Foundation essentially distributes income already taxed in the Carlsberg Group to recipients who then generally pay tax on the grants and donations as they are used.

Like other enterprise foundations in Denmark, the Carlsberg Foundation will not pay income tax if its charitable grants and donations remain at the high levels that they have been at historically.