Beyond Borders: What Finance Leaders Need to Know About Tax Risk When Scaling Internationally
By Tax

As UK businesses expand into new markets – whether through acquisition, organic growth, or partnerships – tax risk grows exponentially.  

With increased regulatory scrutiny, cross-border transparency measures, and the risk of missteps in local jurisdictions, finance leaders need to elevate tax from a compliance afterthought to a strategic planning input. 

Why Tax Risk Can’t Be an Afterthought 

International expansion opens the door to opportunity, but it also introduces complexity. 

Common tax pitfalls include: 

  • Misunderstanding permanent establishment rules in new jurisdictions. 
  • Poor transfer pricing documentation, leading to disputes or double taxation. 
  • Failing to register for indirect tax (VAT/GST) in countries with threshold-based regimes. 

These risks are exacerbated by misalignment between commercial strategy and tax planning, especially when local legal, payroll, and finance structures aren’t in place before trading begins. 

The Changing Regulatory Landscape 

Key updates affecting UK-based multinationals include: 

  • UK Transfer Pricing Reform: The government’s ongoing consultation aims to tighten documentation requirements and enhance alignment with OECD standards. 
  • BEPS 2.0 and Pillar Two: Minimum tax requirements of 15% on global income are set to reshape how profits are allocated and taxed. 

There’s also growing emphasis on responsible tax behaviour from boards, regulators and investors – creating new reputational risks if international structures are seen as overly aggressive. 

Talent as a Strategic Lever 

To manage this complexity, more finance leaders are hiring tax professionals earlier in their growth journeys. An International Tax Manager or Transfer Pricing Lead can: 

  • Guide structuring decisions with tax implications in mind. 
  • Create scalable documentation frameworks. 
  • Reduce external advisory reliance and associated costs. 
  • Support ESG objectives by building ethical and transparent tax strategies. 

“It’s not just about managing risk—it’s about enabling growth. The right tax hire can empower commercial decisions, not block them.” 

Kirsteen Brannigan‑Hughes, Director of Tax Recruitment 

Case Study: Strategic Indirect Tax Capability for Global Growth 

Cedar was the recruitment partner for a high-growth business services provider with global operations across telecoms, vehicle leasing, and energy solutions. As the company matured into a more corporate structure with private equity backing, it faced urgent challenges around indirect tax strategy – particularly as new service lines emerged in areas subject to evolving case law. 

Recognising the need for proactive leadership, the group set out to hire a Head of Indirect Tax who could shape strategy, improve compliance, and operate as a future successor to the Group Tax Director. Previous attempts through other recruitment providers had failed, largely due to the hybrid requirements of technical expertise, commercial acumen, and speed of execution. 

Cedar stepped in to deliver a targeted process that ultimately secured a leader capable of not just managing global VAT risk but contributing to wider governance and growth strategy. The success of this hire underlines the importance of getting specialist tax talent in place early, especially when expansion is driving complexity.  

Leadership Lessons 

To future-proof international expansion, finance leaders should: 

  • Embed tax professionals in strategic planning, not just compliance. 
  • Benchmark tax maturity against growth plans. 
  • Consider internal tax investment as part of their international playbook. 
  • Ensure that governance, documentation, and ethics are part of every jurisdictional footprint. 

The earlier tax is part of the conversation, the more value it can deliver. 

If you’re considering international expansion and want to understand your in-house tax needs, our specialist recruiters can provide a Tax Team Skills & Structure Assessment. Designed to help map where your team is today, highlight any capability gaps, and align your structure with future business goals. Get in touch with our team today.