Economy

Facebook brings British profits onshore after tax rule change

Facebook brings British profits onshore after tax rule change”

Facebook paid £5.1m in tax in the United Kingdom past year, up from £4.2m in 2015, following a major overhaul of the social media firm's tax structure.

Facebook said in filings with Britain's corporate register that the turnaround followed four years of losses totalling nearly 100 million pounds.

After Britain's attempts to pay more tax on social networking platforms in recent years, tax paid by Facebook's advertising revenues is 4.2 million sterling in 2015, with a total of 5.1 million in 2016 Sterline has risen.

Facebook's accounts also show it has 960 employees in the United Kingdom, and that it paid out £104 million in wages in 2016.

In 2015, turnover was booked through Facebook's European headquarters in Dublin and the British subsidiary's revenue represented payments from the Dublin unit.

That suggests that the average employee of Facebook UK is paid more than £108,000, before any bonuses are taken into account.

The 2016 tax charge was also reduced by "additional expenses deductible for tax purposes" which the firm declined to outline. However, the £5.1m it paid in corporation tax was up only slightly from £4.2m the year before.

These results will add to the scrutiny that is now routinely paid on the tax paid by giant global technology companies.

This means they usually do not report profits in the countries where their salespeople and customers are based, making it impossible for hosts to tax them.

European Union authorities are pursuing global technology companies over what they see as unfair avoidance of tax in the countries where they have most customers by routing business through lower tax jurisdictions.



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