UK Tax Strategy Statement 2021

For the financial year ended 31 December 2021

The publication of this strategy statement is regarded as satisfying the statutory obligation under paragraphs 19(2) and 22(2), Schedule 19, Finance Act 2016. This tax strategy applies to all Pharmaron companies incorporated and operated in the UK, for which Pharmaron Beijing Co., Ltd. is the ultimate parent company (hereafter ‘The Group’).

Introduction

The Group business strategy is to strengthen our fully integrated pharmaceutical R&D platform to accelerate global drug innovation.

Our business activities incur a variety of business taxes including corporate income taxes, employment, and other taxes. In addition, we collect and pay employee taxes and indirect taxes such as VAT. We operate policies and governance to ensure compliance with UK tax law.

The Group is committed to complying with tax laws in a responsible manner, and this document sets out:

• Our approach to governance, risk management and compliance with UK tax laws
• Our approach to tax planning as affecting UK taxation
• The level of UK tax risk we are prepared to accept
• Our approach towards dealings with the HMRC.

Governance, risk management and compliance with UK tax laws

We are committed to compliance with all statutory obligations, paying the right amount of tax at the right time. This involves disclosing all relevant facts and circumstances to HMRC and claiming reliefs and incentives where available, in accordance with applicable legislation. Day to day governance for the correct application and compliance with UK tax law is undertaken by the Finance function, both locally and group, and operational teams are also held responsible for the information provided and compliance with company policies and procedures.

We have established and maintain robust policies and processes to ensure the taxes are calculated correctly, risk of error is minimised, and tax is paid in a timely manner.

Tax policies and procedures are continually monitored and updated, employees involved are provided with appropriate training and professional support.

Our approach to tax planning as affecting UK taxation

We plan our taxes with reference to current relevant legislation. When entering into commercial transactions, we seek to apply available tax incentives, reliefs and exemptions, where appropriate, in line with UK tax legislation (e.g., R&D tax credits).

We do not undertake aggressive tax planning for the purpose of tax avoidance.

We have regular advice from a range of tax advisors and reliance is placed upon external tax advisors where there is need for specialist guidance and support.

We apply the OECD transfer pricing guidelines to intercompany transactions.

The level of UK tax risk we are prepared to accept

The level of UK tax risk we accept is consistent with the Group’s broader business risk management, compliance, and transparency framework. We adopt the risk management training for appropriate employees, covering all relevant aspects of good and compliant business practice.

In relation to any specific issue or transaction, the appropriate personnel are responsible for identifying the risks, including tax risks, which need to be addressed and for determining what actions should be taken to manage those risks, having regard to the materiality of the amounts and obligations in question.

There are no pre-defined limits as to the amount for acceptable tax risk; it is judged on an issue-by-issue basis. Where the applicable laws and regulations are subject to interpretation, we seek appropriate assurance regarding the position taken, using professional advisors and where appropriate direct from HRMC.

Our approach towards dealings with the HMRC

We are committed to maintaining a transparent and open relationship with HRMC.

Any inadvertent errors in submissions made to HMRC are fully disclosed and corrected as soon as is reasonably practicable.

Were HMRC to take a different interpretation of the tax impact of a particular business transaction, we would seek to resolve this issue though open dialogue in a prompt and responsible manner.