Henning Lauritsen is a leader in the tax profession and has created internal tax teams for a number of large international companies. Having worked with Henning to build the tax team at Wyelands Capital, SRM Recruitment asks for Henning’s advice on how to build a tax team from scratch.
What kind of people should you look for?
It’s critical to source people who understand how to work with the business if you want to successfully build a tax team from scratch. Of course, a tax professional needs to understand compliance, but they need something more than that. It goes beyond being up to date with operations, they have to really understand the business approach.
When we set up the tax team at Wyelands Capital, we partnered with SRM Recruitment because we wanted to build a thinking tax team, not an operational tax team. We partnered to create a strategy, which was approved by the CFO, and SRM helped me to fill a number of roles. In the past, the Group’s tax department was too operational – we wanted to be real advisers. Now, the team are in place and my boss has relocated so we’ll be even closer moving forward. It’s fundamental to work closely together so the senior management can understand tax.
I think it’s more important to find balance in your team than to try and hire the ‘perfect candidate’ on paper. When we were creating our tax team at Wyelands Capital, we had some very strong theoretical tax knowledge, but we needed someone who brought more practical experience. We sourced a candidate from South Africa who had really strong practical skills, and this complemented the strengths others had. You have to think of the team as a whole.
How do you run your team?
We have one central Group tax department, but we also have satellite tax departments in Bucharest, Ostrava, Sydney and Dallas. The local knowledge is invaluable, and it keeps the dynamic fun – they love visiting the London team, and vice versa. I have always tried to set up tax teams to reflect the countries we are operating in, as well as having a gender-balanced, multicultural team. When you have the opportunity to build a tax team from scratch, I think it’s important to mirror the real-world environment and have that diversity.
In terms of rewards, teamwork is key, so for example, a bonus wouldn’t be awarded unless people work well together. They don’t have to like each other – that doesn’t matter in our department – but everyone must cooperate. I have a strong belief in the power of the team.
We hold a weekly meeting to ask everyone what they’re working on. This is also a great opportunity to share our knowledge with the business, by inviting colleagues from other disciplines e.g. procurement to talk about what they are doing and how we can help.
How can you work most effectively with tax authorities like HMRC?
The first thing to understand is that tax authorities do want to work with you. By having an honest, respectful dialogue, you can work more effectively. For example, in Malaysia, we advised the authorities that we couldn’t work to their timetable, and also that our system is approximately correct (we called it our 80% rule.) That is not unusual by the way – no matter how much you go into the detail, something will always be wrong. So, we try to be practical and realistic and explain any limitations. It actually helps us be more accurate because we are not sweating the ‘small’ stuff but making sure we are putting time into what really matters. We explained we were following OECD guidelines, and they understood.
We have a good relationship with HMRC because we are open and transparent. They joined us at a risk review and we had a very good meeting. They don’t actually like court cases – they want to solve problems.
It’s really just a case of being good corporate citizens – and not just the tax department. We’re here to help and assist, and by doing so we protect our business.
When do you bring in external expertise?
We do need to use outside experts from time to time. We did an acquisition in seven countries and to aid our understanding we used the regional PWC advisors to do the local due diligence work. We know when to ask for help and use external advisors for difficult situations.
Partnering with SRM Recruitment to build our tax team from scratch was a good use of external expertise to find the best talent for our roles. SRM acted as true consultants to our business and helped shape our hiring strategy, as well as filling the positions.
If you are planning to build or expand your tax team, please contact us to discuss your needs. For more information about Henning’s career and for his thoughts on the Future of Tax, visit our Insights section.