Facebook's UK tax: We are the 0%!
Despite its US parent company reporting a net profit of $1.5 billion (£900 million), Facebook UK filed a pre-tax loss of £11.6 million last year, according to its latest financial filing at Companies House published on Wednesday.
To add insult to injury, Facebook paid no corporate tax in 2013, while its employees received an estimated 1.5 million shares in the company worth about $119 million. That amounts to £350,000 per employee.
Meanwhile, staff may be eligible to receive another 2.2 million
shares, valued at about £105 million.
Facebook’s shares are now trading above $78.
Research firm eMarketer estimates Facebook UK made £371 million in advertising revenue last year, up from £223 million on the previous year.
Much of these profits, however, are channeled to the Republic of Ireland, which has one of the lowest corporate tax rates in the world.
As a result of this offshore tax evasion scheme, Facebook UK was billed with a corporation tax charge of just £3,169. But even this paltry charge evaded the taxman’s grasp, as the company was reimbursed £182,000 over “adjustments for prior years,” the Independent reported.
Last month, Chancellor of the Exchequer George Osborne vowed to shut the door on corporate tax havens, which the government says costs the UK budget hundreds of millions of pounds each year.
“Some technology companies go to extraordinary lengths to pay little or no tax here,” Osborne - who did not single out Facebook - told the Conservative Party Conference in September.
“If you abuse our tax system, you abuse the trust of the British people. And my message to those companies is clear: we will put a stop to it.”