Introduction
TFG Brands (London) Limited is a wholly owned subsidiary of The Foschini Group Limited (“TFG”), a South African retail group listed on the Johannesburg Stock Exchange. It is the central office for the group’s United Kingdom (“UK”) operations which include the Phase Eight, Hobbs, Whistles, and Inside Story brands. This tax strategy statement is made available in accordance with Schedule 19 of Finance Act 2016 and outlines the approach of TFG Brands (London) Limited and the UK Group (together “TFG London”) to the management of its tax affairs for the year ended 30 March 2024.
Our Business
TFG London is a retail fashion group operating through 178 stores and approximately 369 concessions worldwide (both within the UK and overseas)1, as well as through a strong online presence. TFG London’s principal brands are Phase Eight2 (acquired in January 2015), Whistles3 (acquired in March 2016), Hobbs4 (acquired in November 2017) and Inside Story (launched in 2023).
Phase Eight2 is a premium womenswear brand operating in 13 countries1. Together with its subsidiaries, it trades from 68 stores and, and 163 concessions worldwide, as well as through its own websites and several concession partner websites.
Whistles3 is a contemporary womenswear fashion brand operating in 4 countries3. Its main trading company is Whistles Limited. Together with its subsidiaries, Whistles trades from 33 stores, and 87 concessions worldwide1, as well as through its own websites and a number of concession partner websites.
Hobbs4 is a premium womenswear brand operating in 9 countries1. Hobbs operates 74 stores and outlets, and 119 concessions worldwide1, as well as through its own websites and several concession partner websites. Its main trading company is Hobbs Limited.
TFG London also launched its own homeware offering, Inside Story5, in 2023. Inside Story primarily trades through its own website, opening 1 store during FY24.
Our approach to risk management and governance arrangements in relation to UK taxation
TFG London is committed to being a responsible and compliant taxpayer in the countries where we operate. We seek to achieve and maintain a low-risk tax profile in the UK and equivalent internationally. This tax strategy statement has been approved by the board of directors of TFG Brands (London) Limited, which has ultimate responsibility for TFG London’s tax affairs. TFG actively monitors and manages risk across the wider group, with regular dialogue between TFG London and TFG’s Head of Tax in South Africa. Day to day responsibility for tax matters is delegated to the Head of Tax employed by TFG London. Where appropriate, TFG London obtains advice from leading professional advisers to evaluate risk, adhere to complex tax laws and implement best practice.
Our attitude to tax planning, so far as it affects UK taxation
TFG London aims to comply with all applicable tax laws, rules and regulations. It is committed to paying UK corporation tax in line with all requirements, using group relief where taxable losses are available and claiming appropriate reliefs and incentives where available. TFG London is similarly committed to paying VAT, customs duties, employer’s national insurance contributions, excise duties, business rates and other indirect taxes in line with all requirements. As concerns transactions between TFG London group companies, as well as with other related companies, TFG London is committed to complying with OECD guidelines on transfer pricing. The commercial needs of the business are paramount, and all tax planning is undertaken in this context. All transactions undertaken by TFG London have a commercial or economic substance. TFG London is committed to acting with integrity and transparency on all tax matters and complying fully with UK tax law.
The level of risk we are prepared to accept in relation to UK taxation
TFG London’s appetite for tax risk is low, acknowledging that tax risks will arise from time to time in relation to the interpretation of tax law and the nature of our tax compliance arrangements, given the size of our business. Tax risks are identified, evaluated, managed and monitored on a case-by-case basis to ensure they remain in line with TFG London’s overall low risk appetite. Where there is significant complexity or uncertainty in relation to a specific risk, external advice is sought from TFG London’s professional advisors. We structure our tax affairs based on sound commercial principles and in accordance with relevant tax laws, with the objective of complying with legal requirements in a manner which ensures submission of tax returns on time and payment of the right amount of tax in the right place at the right time.
Our approach to dealings with HM Revenue & Customs (“HMRC”)
TFG London engages with HMRC in an open, collaborative and honest manner. We share information about our commercial developments or transactions, especially where there are complex tax implications, and seek to resolve any disputed matters promptly, through proactive and transparent discussions with HMRC. The team at TFG London seek to fully respond to information requests from HMRC, whether formal or informal. The publication of this tax strategy statement is regarded as satisfying the statutory obligation under Paragraph 16(2) of Schedule 19 to the Finance Act 2016.
Date of publication: 10 June 2024
1. As at 30 March 2024
2. Phase Eight (Fashion & Designs) Limited and its subsidiaries
3. Whistles Holdings Limited and its subsidiaries
4. Hobbs Fashion Holdings Limited and its subsidiaries
5. TFG Homeware Limited