FaceBook U.K. Business paid £238.300 Corporation Tax on sales estimate of £175 million

Facebook's UK Tax Rate Slammed As 'Unethical'


The world's biggest social networking website pays UK corporation tax of just £238,000 - as its staff costs triple to £24m.


6:30pm UK, Thursday 11 October 2012



Video: HMRC 'Is Too Relaxed About Tax Avoidance'
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• Facebook's UK business paid just £238,300 in corporation tax last year, accounts have revealed, in a move described as "unethical" by campaigners.
  

The world's biggest social networking website declared a turnover of £20.4m in the UK for 2011 - up from £13m the year before - but analysts say its actual earnings are much higher.

Media research firm Ender Analysis estimates that sales were more likely to be around £175m last year, as advertisers continue to flock to the company.

Accountant Richard Murphy, who founded the Tax Justice Network, said Facebook is the latest US technology company to abuse the UK's tax system.
Zuckerberg founded the website in 2004
"They are shifting their income to low-tax countries such Ireland, but dumping costs in the UK to make sure they pay as little tax as possible," he said.

"Facebook is only declaring a fraction of the UK sales we expect it is making.

"Is it legal? Yes. But it is unethical because they are deliberately free-riding the system."

High wage costs meant Facebook actually recorded a pre-tax loss of £13.9m in its annual accounts published by Companies House.

Its total bill for staff costs and wages was more than triple the previous year's at £24.8 million, which - as it only employs 90 people in the UK - is equivalent to more than £275,000 per employee.

These costs include a £15.4m "share-based payment charge" which is believed to cover employees' income tax and national insurance on shares they received before the company's stock market flotation in May.

Mr Murphy said the time had come for a Europe-wide review of the practice with the aim of ensuring tax is paid in the country it is earned.

Treasury Committee member John Mann MP said technology companies benefit from the UK’s internet infrastructure but do not pay tax to fund it.

"There should be an internet tax on internet companies – in the same way that cars have a road tax," he told Sky News.

Facebook was listed on New York’s Nasdaq in May, and its shares have lost around 50% of their value since.

But its popularity keeps growing, and earlier this month founder Mark Zuckerberg announced the website now has more than one billion users across the world.

Following the publication of its accounts, Facebook said: "As is normal for an organisation operating in dozens of countries around the world, we regularly file reports about local operations.

"The information does not necessarily present a full account of overall global financial performance so it would be a mistake to draw any conclusions from these filings."

When is the Government going to stop these tax avoidance Companies, too much vested interest? Or maybe inertia.

Too many backhanders more like.......

malena stool wrote:Too many backhanders more like.......

Morning Malena, tax avoidance has been going on for many years, now that Britain has hit rock bottom and is in danger of losing it's AAA status , Banks have proved to be out of control , the austerity measures hitting the poorest, not a word from Cameron and George about cleaning up Britain.

IS THIS PROFIT COMING FROM ADVERTISING?

Badboy wrote:IS THIS PROFIT COMING FROM ADVERTISING?

"Facebook is only declaring a fraction of the UK sales we expect it is making"........Yes Badboy, like Barclays bank only paid 1% Tax last year.!!!

Panda wrote:

malena stool wrote:Too many backhanders more like.......

Morning Malena, tax avoidance has been going on for many years, now that Britain has hit rock bottom and is in danger of losing it's AAA status , Banks have proved to be out of control , the austerity measures hitting the poorest, not a word from Cameron and George about cleaning up Britain.

Hi Panda, the both of them are likely as corrupt and devious as the rest of our so called 'Honourable and Respected' leaders, just snorting and grunting in the trough for all they can get. To clean up British politics and to put the sleazy banking world back to some form of honest, decent trading standard would hurt their own pockets and I doubt either of them would do that.

I honestly don't think I have known such a corrupt Goverrnment as we have today, I do pity the next generation having to cope with the mess the Economy is in . No wonder today's youth are taking drugs and drinking too much , they don't feel they belong to Society and have no thought for the future.

Panda wrote:I honestly don't think I have known such a corrupt Goverrnment as we have today, I do pity the next generation having to cope with the mess the Economy is in . No wonder today's youth are taking drugs and drinking too much , they don't feel they belong to Society and have no thought for the future.

The vast majority of them certainly have nothing to look forward to, Panda.