TCRM1000 - Executive summary
Source: gov.uk (2025-05-07)


This guidance is for Large Business Customer Compliance Managers (CCMs) and their customers. It explains HMRC’s approach to working with Large Business customers to manage their tax compliance risk. The key elements of this approach are:
- to build and maintain effective relationships with all our customers, promoting delivery of the right tax at the right time
- to classify our customers within a compliance spectrum (Low, Moderate, Moderate-High, High) so that we can deploy our resources appropriately
- for those customers who are not Low Risk, to understand why and in what respects they are not low risk so that HMRC and the customer can target their resources effectively
Our Framework for Co-operative Compliance is a set of principles that both large businesses and HMRC should apply to how they work within a co-operative compliance approach to ensure that the right tax is paid at the right time. The Framework can be found at TCRM2210 (https://www.gov.uk/hmrc-internal-manuals/tax-compliance-risk-management/tcrm2210)

We decide a customer’s overall level of tax compliance risk within the context of the landscape in which the business operates in terms of, for example, their size, complexity and the degree and pace of change they experience. This provides the environment within which subsequent behavioural markings can be assessed since some of these factors can introduce challenges for customers and their compliance with tax obligations.

We, more importantly, determine how the customer mitigates tax risk through their behaviours, specifically in the three areas of Systems and Delivery, Internal Governance and Approach to Tax Compliance. This assessment is conducted during the periodic Business Risk Review (BRR+), which is a collaborative process between the customer and HMRC.

With the right behaviours any customer, regardless of their size or complexity, can be classified as Low Risk.

We gather evidence of customer behaviour for each tax regime in the three areas of Systems and Delivery, Internal Governance and Approach to Tax Compliance and assess this evidence against a series of indicators. Broadly, the more indicators that are satisfied, the lower the risk rating. In order to be classified as Low Risk in any tax regime, the following will apply;

Systems and Delivery

The customer will:
- deploy sufficient resources to system design, build and maintenance that will deliver timely and accurate returns, declarations, payments and claims, including accounting systems and processes that are suitable for the size and complexity of the business
- employ sufficient and suitably skilled resource in the Finance/Tax team to deliver timely and accurate returns, declarations, payments and claims
- submit all returns and payments on time
- have not been subject to HMRC interventions that have identified significant errors
- maintain a tax risk and controls matrix and share this on request from HMRC
- maintain documented tax policies and procedures and share these on request from HMRC
- undertake assurance checks and testing of its policies and procedures on a regular/timetabled basis and disclosing errors that have a tax impact to HMRC
- take reasonable steps, where key fiscal areas are outsourced, to ensure the provider is suitably competent, qualified or controlled in order that transactions which impact on tax are properly accounted for
Internal Governance

The customer will:
- have clear accountabilities up to and including the Board for the management of tax compliance risk and tax planning, and
- have appropriate tax accounting arrangements so as to enable accurate tax reporting
- keep HMRC informed of how the business is structured and where different parts of the business are located
- have fulfilled its filing, notification (or exemption), due diligence, reporting, documentation, registration and/or publication obligations regarding Senior Accounting Officer legislation, Uncertain Tax Treatment legislation, Country by Country Reporting, Tax Strategy publication, the Transfer Pricing Records Regulations, OECD Pillar 2 Top-Up tax and Automatic Exchange of Information under the Common Reporting Standard or FATCA (if appropriate)
- appreciate its potential liability under the Corporate Criminal Offence legislation and have taken steps to profile and manage the risk of failing to prevent the facilitation of tax evasion
- have identified and communicated to HMRC promptly any significant uncertainties or irregularities
- discuss in real time and communicated with HMRC collaboratively any transactions or issues with significant tax implications
- provide prompt, accurate and helpful answers in response to HMRC's queries and requests for information
Approach to Tax Compliance

The customer will:
- maintain an open and transparent relationship with HMRC
- have a documented tax strategy that is used to steer all tax considerations
- regularly review and update their tax strategy when appropriate
- be open with HMRC in real time about how tax compliance risk is managed across all relevant taxes and duties
- not be involved in tax planning other than that which supports genuine commercial activity and will fully disclose the facts and any legal uncertainty of relevant transactions
- will not structure transactions in a way which gives a tax result contrary to the intentions of Parliament
- is not directly involved with illicit trades and is active in mitigating illicit trades within their supply chain
- will not have incurred an inaccuracy penalty, including any penalties that may have been suspended
Each of these areas is assessed separately for each tax regime by a Tax Specialist. The Customer Compliance Manager, in discussion with their team of Tax Specialists, will come to a conclusion as to the customer’s behaviours overall. Both the individual tax regime ratings and the overall rating for the group will be shared by the CCM and discussed with the customer. This is to increase transparency and collaboration between the CCM, Tax Specialist and customer in working towards a lower risk rating, or to maintain a low risk rating.

If we assess a customer to be Low Risk this is because we are confident that an open and trusting relationship between them and HMRC can be sustained. In general, HMRC will not initiate interventions with them, apart from certain interventions which potentially apply to all customers, such as mandatory work or projects and campaigns. We will not normally carry out another Business Risk Review for three years and in the interim will not generally challenge their tax returns or declarations. We will, however, maintain sufficient contact to ensure that our knowledge of the business is up-to-date. This will help us to provide customers with a good standard of service and ensure that both parties are kept informed of emerging significant risks.

In cases where a customer seriously breaches any of the behaviours that HMRC expects Low Risk customers to display, we may decide to immediately withdraw that status and its benefits. We will however always try to work with the customer to re-establish trust and confidence in their behaviours subsequently.

In the case of customers who are not Low Risk, we will still aim to develop and maintain an open and transparent relationship with them and to work collaboratively with them in real time to reduce their level of tax compliance risk. Working in this way helps both sides manage their resources better and provides the customer with more certainty about their tax position. In general, customers who are not Low Risk can expect us to:
- Carry out annual Business Risk Reviews (BRR+)
- Carry out regular analysis (Risk Assessment) of their tax returns to identify areas of potential risk (though we will target this based on our understanding of where risk may lie as developed during the BRR+ process)
- Carry out more regular interventions (Risk Working) to test the information we have been given
The results of this Risk Assessment and Risk Working activity will be fed back into the Business Risk Review (BRR+).

If the customer indicates that they would like to achieve Low Risk more quickly than the 12 month cycle this should be encouraged. Customers should be asked to confirm how they will address any weakness and over what period and if appropriate the CCM may agree to reassess the rating ahead of the 12 month cycle.

In cases where customers represent an ongoing and significant risk, we may assemble teams of specialists to deal with the risk intensively and will engage at Board level to persuade that customer to change the behaviours that are generating those risks.