Chapman Freeborn Holdings Limited Tax Strategy

Published: 30 September 2019

Scope

Chapman Freeborn Holdings Limited (“the company”) is incorporated as a limited company, registered in England and Wales, under the Companies Act 2006. This strategy applies to the Company and to the group of companies headed by Chapman Freeborn Holdings Limited in accordance with paragraphs 1 – 24 of Schedule 19 (“the schedule”) to the Finance Act 2016. A list of the entities to which it applies is set out below as Appendix One.

The strategy has been published by Chapman Freeborn Holdings Limited as ultimate holding company and head of the group, as outlined in paragraph 16(2) of the schedule. The tax strategy has been published on the Chapman Freeborn website (https://www.chapman-freeborn.com) and is accessible to the public in accordance with paragraph 16(4) of the Schedule.

This strategy applies from the date of publication until it is superseded. References to ‘UK Taxation’ are to the taxes and duties set out in paragraph 15(1) of the Schedule which include:

  1. Income tax
  2. Corporation tax
  3. VAT
  4. PAYE
  5. Diverted profits tax
  6. Insurance premium tax
  7. Annual tax on enveloped dwellings
  8. Stamp duty land tax
  9. Stamp duty reserve tax
  10. Petroleum revenue tax
  11. Customs duties
  12. Excise duties

 

References to ‘tax’, ‘taxes’ or ‘taxation’ are to UK taxation and to all corresponding worldwide taxes and similar duties in respect of which the Company has legal responsibilities.
The content within this document is in accordance with the disclosure requirements outlined in paragraph 23(1) of the Schedule.

Aim

Chapman Freeborn Holdings Limited is committed to full compliance with all statutory obligations and full disclosure to tax authorities. The Company’s tax affairs are managed in a way which considers the Company’s wider corporate reputation, in line with the Company’s overall high standards of governance.

The company ensures the tax strategy is:

  • Adopted and followed consistently by all subsidiaries
  • Consistent with Chapman Freeborn’s approach to corporate governance and risk management.

 

Governance in relation to UK taxation

Ultimate responsibility for the Company’s tax strategy and compliance rests with the Board of Chapman Freeborn Holdings Limited, which is delegated by the Board to the Executive Directors, namely the Chief Financial Officer (CFO).

As part of the corporate governance, the Group has appointed a Senior Accounting Officer (SAO), a position required by UK Law. The SAO is responsible for monitoring the integrity of the Group’s financial reporting system, internal controls and risk management framework, expressly includes those elements relating to taxation.

The CFO is the board member with executive responsibility for tax matters, and day-to-day management of the Company’s tax affairs, which are delegated to the Group Financial Controller, who reports directly to the CFO.

Haslers Chartered Accountants are retained as the Company’s tax advisors and are widely consulted and engaged on all tax related matters.

The Board and Executive Directors ensure that the Company’s tax strategy is one of the factors considered in all investments and significant business decisions taken. The CFO reports to the Board on Chapman Freeborn Holdings Limited who reviews the tax affairs and risks of the group during the year.

Each part of our business and each of our employees are responsible for ensuring that they fully comply with our Tax Strategy and Tax Principles. This is further reviewed as part of the responsibility of the SAO to ensure the control mechanisms and procedures the Group has in place are in accordance with the Tax Strategy and Tax Principles.

Risk Management

Chapman Freeborn Holdings Limited operates a system of tax risk assessments and controls as a component of the overall internal control framework applicable to the Company’s financial reporting system.

The Group seeks to reduce the level of tax risk arising from its operations as far as is reasonably practicable by ensuring that reasonable care is applied in relation to all processes which could materially affect its compliance with its tax obligations within the United Kingdom and other tax jurisdictions in which we operate.

Processes relating to different taxes are allocated to appropriate process owners, who carry out a review of activities and processes to identify key risks and mitigating controls in place. These key risks are monitored for business and legislative changes which may impact them and changes to processes or controls are made when required.

Attitude towards tax planning and level of risk

Chapman Freeborn Holdings Limited manages risks to ensure compliance with legal requirements in a manner which ensures payment of the right amount of tax. The Company’s attitude towards tax planning is consistent with the ‘Tax Principles’ adopted, and which are set out below. When entering into commercial transactions, the Company seeks to take advantage of available tax incentives, reliefs and exemptions in line with, and in the spirit of, tax legislation. The Company does not undertake tax planning unrelated to such commercial transactions.

The level of risk which the Company accepts in relation to UK taxation is consistent with its overall objective of achieving certainty in the Company’s tax affairs. At all times the Company seeks to comply fully with its regulatory and other obligations and to act in a way which upholds its reputation as a responsible corporate citizen.

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

Relationship with HM Revenue & Customs (HMRC)

Chapman Freeborn Holdings Limited seeks to have a transparent and constructive relationship with HMRC through regular communication in respect of developments in the Group’s business, current, future and retrospective tax risks, and interpretation of the law in relation to all relevant taxes.

The Company ensures that HMRC is kept aware of significant transactions and changes in the business and seeks to discuss any tax issues arising at an early stage. When submitting Corporation Tax Returns and tax computations to HMRC, Chapman Freeborn Holdings Limited discloses all relevant facts and identifies any transactions or issues where it considers that there is potential for the tax treatment to be uncertain.

Any inadvertent errors in submissions made to HMRC are fully disclosed as soon as reasonably practicable after they are identified.

In all of the Group’s dealings with HMRC, our approach is to be open, to co-operate fully with their enquiries in a timely manner and to be proactive in raising any significant issues or uncertainties.

Tax Principles

Chapman Freeborn Holdings Limited UK Tax Principles record the Company’s UK approach to taxation and dealing with taxation authorities.

Legal and ethical

  1. We act lawfully and with integrity and expect the same from our people, our customers, our suppliers, tax authorities and other parties with whom we interact.
  2. We respect the needs of our people and the communities in which we operate.
  3. We will consider our view of prevailing public interest considerations and of any potential reputational risk to the Company.
  4. We shall not act in such a way as to undermine the structure of the tax system of the United Kingdom and other tax jurisdictions worldwide.
  5. We shall not entertain arrangements that evade tax or that rely, to any extent, in the tax authorities inability to collect such tax.
  6. We shall not exploit social policy legislation (for example, tax reliefs for charities).
  7. We will interpret legislation in a purposive way in line with the courts. We will not enter into transactions with the main purpose of securing a tax advantage clearly contrary to the intention of
  8. Parliament in enacting the relevant legislation.
  9. We will not endorse the use of Umbrella companies in relation to the employment of contractors, except where transitional arrangements necessitate their temporary use.

 

Transparency

We support a relationship with tax authorities, based upon mutual trust and respect which will enable constructive dialogue and responsiveness by all parties in order to fulfil our responsibilities.
We shall comply with all our disclosure requirements. We shall disclose to the authorities, and not conceal, disguise or misrepresent, all material facts.

Appendix One: Full list of Subsidiaries

As of 31 December 2018, the full list of subsidiaries as outlined in paragraph 16(6) of the Schedule. The Group companies listed below, along with their country of incorporation, ownership by Chapman Freeborn Holdings Limited and a brief description of each company’s main nature of trade.

This is included within the Group’s list of subsidiary companies in the 2018 annual financial statements:

Company Name Company
Registration
Number
Country of
Incorporation
Ownership Nature of Trade
Chapman Freeborn Holdings Limited 06860099 England and Wales n/a Ultimate Holding Company
Chapman Freeborn International Ltd 01111032 England and Wales 100.00% Holding Company
Chapman Freeborn Airchartering (China) Ltd 06944518 England and Wales 100.00% Aircraft Chartering Company
Chapman Freeborn Airchartering Ltd 01053714 England and Wales 100.00% Aircraft Chartering Company
Zuesbond Ltd 01527679 England and Wales 75.00% Holding Company
Magma Aviation Limited 07106976 England and Wales 75.00% Aircraft Chartering Company
Wings 24 Ltd 04338443 England and Wales 100.00% Other Service Company
Logik Logistics International Ltd 08207267 England and Wales 80.00% Other Service Company
Intradco Cargo Services Ltd 02200670 England and Wales 75.00% Aircraft Chartering Company
Chapman Freeborn Airchartering Ltd n/a Afghanistan 100.00% Dormant
Altrans Management Pty Ltd n/a Australia 100.00% Aircraft Chartering Company
Chapman Freeborn Airchartering BVBA n/a Belgium 80.00% Aircraft Chartering Company
Chapman Freeborn Airchartering Ltd n/a Canada 100.00% Aircraft Chartering Company
Chapman Freeborn Airchartering Consulting
(Shanghai) Co. Ltd (Beijing Chaoyang Branch)
n/a China 100.00% Aircraft Chartering Branch
SCI France Patrimoine n/a France 100.00% Dormant
Chapman Freeborn Airmarketing GmBH n/a Germany 100.00% Aircraft Chartering Company
Chapman Freeborn OBC GmBH n/a Germany 100.00% On Board Courier Company
Chapman Freeborn OBC Holdings GmBH n/a Germany 100.00% Dormant
Chapman Freeborn Airchartering GmBH n/a Germany 100.00% Dormant
Chapman Freeborn Airchartering Ltd n/a Hong Kong 100.00% Aircraft Chartering Company
Chapman Freeborn Handcarry Ltd n/a Hong Kong 100.00% On Board Courier Company
Chapman Freeborn Airchartering pvt Ltd n/a India 100.00% Aircraft Chartering Company
Al Tajer Al Hur Company Ltd (Free Merchant Services) n/a Iraq 100.00% Dormant
Chapman Freeborn Airchartering Sp Z.o.o n/a Poland 85.00% Aircraft Chartering Company
Chapman Freeborn Airchartering Pte Ltd n/a Singapore 100.00% Aircraft Chartering Company
Chapman Freeborn Airchartering
(South Africa) Pty Ltd
n/a South Africa 100.00% Aircraft Chartering Company
Chapman Freeborn Airchartering SL n/a Spain 100.00% Aircraft Chartering Company
Chapman Freeborn Airchartering
(Schweiz) AG
n/a Switzerland 100.00% Dormant
Chapman Freebornm Havacilik Tasimacilik Ticaret Ltd (Sirketi) n/a Turkey 100.00% Dormant
Chapman Freeborn Aviation Services FZE (Dubai Branch) n/a UAE 100.00% Aircraft Chartering Branch
Chapman Freeborn Aviation Services FZE n/a UAE 100.00% Aircraft Chartering Company
Chapman Freeborn Aviation Services FZCO n/a UAE 100.00% Aircraft
Chapman Freeborn Airchartering (Uganda) Ltd n/a Uganda 100.00% Aircraft Chartering Company
Chapman Freeborn OBC Inc n/a USA 100.00% On Board Courier Company
Chapman Freeborn Airchartering Inc n/a USA 100.00% Aircraft Chartering Company

 

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