Country-by-country tax reporting
Coloplast’s approach to taxes
Respect & responsibility is a guiding principle for Coloplast. Irrespective of country and market, Coloplast wants to be known and trusted as a company that upholds the highest standards of ethical business practices.
Coloplast sees taxes as an important part of the business, just as respecting local tax laws and regulations is important to the company’s reputation and brand.
At Coloplast, taxes are paid where business activities generate value in accordance with internationally accepted standards. Coloplast does not allow commercial needs to override compliance with applicable laws, nor base commercial activities on tax avoidance schemes.
All transactions and tax structures must therefore have a business purpose or commercial rationale as a prerequisite, and Coloplast will only engage in tax planning schemes and structures that can, in full transparency, be shared with, and accepted by the tax authorities. In case of business changes, tax positions are analyzed revised accordingly.
Following these principles, Coloplast will leverage tax opportunities if they arise. This includes government sponsored tax and investment incentives. Coloplast will also proactively seek knowledge to obtain a competitive effective tax rate as well as to avoid double taxation.
Tax risks and controlling activities are assessed and monitored in a tax control framework. Risks identified are mitigated on an ongoing basis. The tax control framework is governed by Coloplast’s Corporate Tax department.
Please find more information about Coloplast commitments in our tax policy here.
Introduction to country-by-country tax reporting
Coloplast A/S is a global corporation with the ultimate parent located in Denmark.
The nature of being a global corporation implies that goods are sold, services are carried out, and intangibles are exploited between Coloplast entities across geographical borders and between different tax regimes.
We pay close attention to transfer pricing requirements and focus on pricing the value of these cross border intercompany transactions on arms-length basis according to best practice guidelines issued by the OECD. These guidelines ensure that taxes are paid where the business activities generate value and are performed within a normal cause of business activity.
Coloplast A/S is the headquarters where the executive management as well as most of the research and development activities reside. Additionally, the majority of intellectual property is held by Coloplast A/S.
Subsidiaries carry out their activities on behalf of Coloplast A/S. This means that Coloplast A/S buys all products manufactured in the Group and sells the products to the distribution entities, who then sell those in the local markets. Some services are carried out in the subsidiaries on behalf of Coloplast A/S and charged accordingly. All activities are remunerated based on regional benchmarked profit margins of independent enterprises with comparable activities.
The country-by-country reporting (CbCr) disclose data based on the content of the EU directive approved by the European Parliament in November 2021 and introduced in Danish legislation in June 2023. According to the EU directive, country by country information is to be disclosed for activities in the 27 EU Member States and additionally for activities in jurisdictions classified as non-cooperative jurisdictions by the European Council (blacklist), or countries which corporate with the European Council but have pending commitments (greylist). Aggregated numbers are presented for countries outside of the EU and non-cooperative jurisdictions
Beyond what is required by the EU directive, Coloplast has decided to disclose following additional data to increase the transparency as well as to strengthen the understanding of how the data is linked to the Group Annual Report.
• Change in deferred income tax on profits
• Income tax related to prior years and changes in tax rates
• Total income tax of the year
• Effective tax rate
The data source is the group consolidation reporting system. This means that the data is based on the International Financial Reporting Standards (IFRS) and the currency is DKK.
The reporting period is 1 October – 30 September for all countries irrespective that the fiscal year is different in a few countries outside EU.
Download Coloplast's country-by-country tax reports: