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University: King's College London and the University of Paris
Virtually all commercial transactions have tax implications. Corporate tax is thus an important practice area for any major law firm. Working in corporate tax involves advising on the most tax-efficient means of acquiring, selling or restructuring assets, negotiating and documenting the transaction, and ensuring the smooth completion of the deal. On the contentious side, corporate tax lawyers advise on all aspects of tax litigation and investigations, including negotiating with tax authorities.
While finding a direction or vocation in life can be a challenge for many, Alicia Thomas had no such difficulties, as it seems her family mapped out her future for her – and she was only too happy to oblige. “When I was really small, around seven years old, I was at my Gran’s house and she asked my cousin and me what we going to be when we grew up,” she recalls. “My cousin said he was going to be a doctor, so I declared - perhaps rather pompously at the time - that I was going to be a lawyer. It sort of stuck and when I got to secondary school, it suited my personality, so I went with it. At that time, I was pretty good at maths and my uncle suggested that if I was going to be a lawyer, I should be a tax lawyer. It turns out, of course, that being a tax lawyer doesn’t involve that much maths at all; but by the time I found that out, it was too late! It seems I am influenced far too easily by my family members!”
Having taken the advice of her nearest and dearest to heart, Alicia set her sights firmly on her goal. After completing a double degree in English and French law at King’s in London and the Sorbonne in Paris, she applied for a vacation scheme at Macfarlanes (on the advice of an aunt, of course) and was offered a place on a training contract. Before taking it up, Alicia worked to shore up her tax credentials, completing a master’s in tax law and taking the chartered tax adviser exams.
Not open all hours
Once on the training contract, Alicia was pleasantly surprised to find that the horror stories she had heard about working hours were somewhat exaggerated in the case of Macfarlanes. “The hours were better than I expected to be as a trainee,” she says. “I think I have done one all-nighter in my entire career. I don’t want to say you don’t have to work hard and it depends on who you speak to, I suppose; but I had heard all sorts of scare stories about people not going home until 4:00am every day. When I got here, I found that it’s really not that bad.”
Luckily for Alicia, she also discovered that she very much enjoyed the practice of tax law outside academia, as it is an intricate and fast-moving area of law that requires multiple skills. “I enjoy it because it constantly changes and presents a challenge,” she explains. “Every year something new comes up and you have to think your way through new problems. There is a lot of actual law involved, as well as lots of negotiation on the corporate side. I think you get the best of both worlds: the practical work with clients, where you just have to get the deal done; and the legal side, where you are trying to work out the solution to a particular problem in a way that isn’t egregious or going to cause them problems in the newspapers.”
Due to the relatively large amount of legislation involved, trainees are likely to be eased in gradually - perhaps working on tax covenant sections of corporate documents that deal with the various tax liabilities when companies change hands. That way, trainees can gain an understanding of the key issues that arise for companies on a day-to-day basis, within the practical context of a sale. It also encourages them to start thinking about the different taxes that apply to companies, such as corporation tax on income and capital gains and value added tax.
With more experience, trainees may be asked to contribute to more complex pieces of work. “Once you have got yourself used to those things, they start giving you more advanced work,” suggests Alicia. “On larger matters, such as an acquisition or the setting up of a fund, you often draft something called a structure paper, which sets out the steps needed to accomplish the goal and their tax implications. As a trainee, you probably won’t do very much of the structure paper itself; but you might be asked to read through it and update the diagrams or update small sections of the paper. The idea is for you to start reading things in more depth and, as time goes on, start becoming responsible for drafting bigger bits of that paper.”
A lot to remember
Alicia readily admits that corporate tax law is in the public eye much more today than when she was a law student. With this heightened scrutiny comes increased political attention and this means that the legislation can change very quickly. She points out, however, that is often better to have a broad overview of the changes rather than spending too much time committing the fine print to memory.
“Tax is now very much at the forefront of the public consciousness,” she acknowledges. “I think back when I was a student, people thought of tax as quite boring. However, since the financial crisis, it has become much more a part of the political sphere and that is represented in the frequency with which we have changes coming about nowadays. While it might seem that you would need an encyclopaedic knowledge to retain everything, I’d say that is safer not to try to remember it all. The best thing to do is to have an awareness of all the things that happened and check the statute for each matter, as every time you read the legislation, there is a new nuance. If you assume that you have memorised it and know what is going on, you may be more likely to miss those points in the context of the particular transaction you are dealing with.”
Those, like Alicia, who are committed to a life as a tax lawyer should able to demonstrate a genuine interest at interview and justify the reasons for that interest – whether through further academic study, sector knowledge or practical experience. However, she also suggests it is important not to appear too set in your ways.
“When I went for my training contract interview, I got the feeling that they thought it was a bit naive of me to think I could possibly know where I want to qualify before I started working in practice,” she recalls. “Generally speaking, people prefer trainees to have an open mind so that they are willing to go and do their best in every seat. So if you have a view about what you want to do, great – but come prepared to justify that. And you still need to show you’re willing to keep an open mind; otherwise you might be shooting yourself in the foot. It is one thing to show yourself as being prepared; it is another to show yourself as being inflexible.”
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