ESG Tax Services

Navigating the tax implications of decarbonisation and energy transition can be complex. We conduct thorough business transformation and supply chain reviews to assess the impact of all relevant taxes. We can quantify the environmental and energy taxes affecting your business in Ireland and beyond. Additionally, we help you identify, apply for and comply with various environmental and energy incentives associated with decarbonisation activities, including capital allowances, R&D tax credits and grants.

Our expertise extends to tax structuring for sustainable finance solutions and tax reviews of investment business models, including Pillar Two impact assessments. We also advise on the tax implications of renewable energy projects and solutions, such as corporate power purchase agreements, carbon credits and carbon trading platforms.

Investing in renewable energy involves complex tax considerations. At PwC, we offer tax structuring advice for investments across various renewable energy sources, including onshore and offshore wind, solar, hydroelectric, and battery storage. We review tax assumptions and attributes in financial models, structure financing and acquisition strategies, and assess the tax implication of cash repatriation strategies. Our services also include reviewing the tax aspects of legal documentation, preparing funds flow documents, providing ongoing tax compliance and consulting services during the project lifecycle, and conducting both buy-side and vendor tax due diligence. Post-acquisition, we assist with tax integration to ensure seamless transitions.

Optimising and aligning your business model with sustainability strategies is essential for long-term success. Our transfer pricing and value chain/supply chain services support business transformation projects to achieve these goals. We design, defend and document operating model changes triggered by sustainability strategies, such as intra-group ETS trading and changing responsibilities in senior management. Additionally, we assist clients in preparing sustainability-related reporting and disclosures, ensuring consistency with transfer pricing documentation.

We also help implement operating models aligned with sustainability goals and leverage transfer pricing systems, including intercompany price-setting software that can track your organisation’s carbon footprint. Our team supports M&A activities, post-deal integration, and the establishment of in-house treasury policies aligned with sustainability objectives.

Maximising the benefits of R&D tax credits and grants requires expertise and precision. We help identify qualifying projects and assist in preparing and reviewing R&D tax credit and grant claims. Our services include preparing technical reports, reviewing financials, and designing bespoke methodologies to support claims. We conduct workshops to highlight critical elements of R&D claims, implement tools like the Research Time Allocator for tracking R&D time, and assist with due diligence. Additionally, we review decarbonisation projects to identify available tax incentives and subsidies and manage reporting requirements, including the Foreign Subsidies Regulation.

Understanding and managing environmental and energy taxes is crucial for sustainability. Our services include modelling and measuring the embedded global carbon price in your cost structure and assessing the implications of rising carbon prices. We provide guidance on energy price caps, assist with the Carbon Border Adjustment Mechanism (CBAM) and other EU ESG market access initiatives, such as deforestation obligations, and conduct environmental tax reviews. Our team helps with compliance, policy analysis, and managing import/export tax risks, ensuring your business remains aligned with environmental goals.

Creating fair and transparent workplace policies is a crucial aspect of ESG. We design and review executive remuneration policies, employee compensation, and incentive plans. Our services include advising on the tax treatment of benefits such as wellness programmes, electric vehicle schemes, and cycle-to-work arrangements. We also review employment status, calculate and validate gender pay gap reporting numbers, and conduct additional analysis to contextualise these figures. Working with Workforce Consulting, we develop compelling narratives around inclusion and diversity, create communication plans, and review strategies to improve disclosures. We also advise on obligations under the EU Pay Transparency Directive, equal pay, national minimum wage, and living wage requirements.

Indirect taxes can significantly impact your business operations. We provide comprehensive reviews of business transformations, contracts and supply chains, advising on the impact of indirect taxes. Our team monitors regulatory changes and provides updates to clients on global indirect tax policies, helping clients embed new taxes and exemptions effectively. We conduct VAT incentive reviews, advise on VAT rates and concessions, advise on vehicle taxes — including aviation fuels — and support the management of VAT for new environmental initiatives, such as the Deposit Return Scheme. Additionally, we manage import/export tax risks to ensure smooth operations across borders.

Transparency on tax matters is essential for building trust and ensuring compliance. We can support the development and implementation of your tax transparency strategy. We prepare comprehensive tax transparency reports and offer advice on preparing total tax contribution reports, complete with supporting narratives. Additionally, we benchmark your tax disclosures against established tax reporting standards, such as GRI 207, and compare them with peer disclosures to ensure best practices are followed.

Effective tax governance is crucial for sustainable business practices. At PwC, we help develop and monitor all components of your Tax Control Framework. This includes creating and refining your tax strategy, establishing tax governance protocols, and documenting tax policies and procedures. We also provide detailed process maps for key tax processes, develop tax risk and controls matrices, and conduct periodic control testing to ensure compliance and efficiency.