Key facts
- HMRC is examining BCG's UK partnership structure and the tax treatment of its senior staff, the primary report said.
- An attached account said the inquiry concerns whether senior BCG partners should be taxed as employees.
- BCG said in filings that an adverse ruling could bring back taxes, interest and penalties, per the attached account.
- BCG said its external legal advisers affirmed its position on partner taxation, per the attached account.
- BCG made no financial provision for the dispute, the attached account said.
Boston Consulting Group is under scrutiny by HM Revenue & Customs over the partnership structure it uses for senior staff in the United Kingdom, according to a report that did not date the event.
The primary report said only that BCG is the latest professional services firm to be examined by HMRC over its partnership structure and the tax calculations applied to senior staff. It gave no date, no figure and no response from the firm.
An attached account said HMRC is examining whether some senior BCG partners should be reclassified as employees for tax purposes, and that BCG disclosed the inquiry in company filings. That account said BCG warned an adverse ruling could bring demands for back taxes, interest and penalties, and that the bill could have a material impact on its UK business, which it said has more than 100 members under a limited liability partnership model.
The same account said BCG has retained external legal counsel, that its advisers affirmed its position on partner taxation, and that the firm made no financial provision because it does not consider a transfer of funds probable. It put BCG's global revenue at $14.4 billion and its workforce at about 33,500 people.