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Facebook UK Paid £35m In Staff Bonuses, But Only £4,327 In Corporation Tax (gu.com)

Posted by Soulskill on from the profits-are-relative dept.

New submitter Phil Ronan writes: After getting away with paying £0 corporate tax in 2013, Facebook UK has announced that its corporate tax payment for 2014 (total revenue: £105 million) is going to be £4,327. This is a tiny fraction of the £35 million pounds given away by the company in staff bonuses over the same period. "The share scheme was worth an average of more than £96,000 for each member of staff. Once salaries were taken into account, a British employee of Facebook received more than £210,000 on average. ... A spokesperson for Facebook said: 'We are compliant with UK tax law, and in fact in all countries where we have operations and offices. We continue to grow our business activities in the UK.' She added that all the firm’s employees paid UK income tax on their payouts."

4 of 262 comments (clear)

  1. Not a bad thing by Pike · · Score: 4, Interesting

    This is actually the way I'd like to see all businesses work. Distribute profits among all employees and tax it as individual income. In a time of stagnant wages and rising inequality what about this practice is bad?

  2. Re:Overall loss? by Anonymous Coward · · Score: 1, Interesting

    Its called Hollywood Accounting.

    Expenditures can be inflated to reduce or eliminate the reported profit of the project, thereby reducing the amount which the corporation must pay in royalties or other profit-sharing agreements, as these are based on the net profit.

  3. Re:So the taxes were collected from salaries inste by Anonymous Coward · · Score: 2, Interesting

    Is the British corporate rate that different from the personal rate? Did the British government not collect the taxes either way, or did I miss something?

    The main complaint is that multinationals offshore their profits by e.g. licensing key bits of IP from a subsidiary in a tax haven. 'We would have made a profit, but we paid $100 million to use the Facebook logo to Facebook Holdings (Cayman Islands). ' (not an actual quote).

    So the answer is, the US government may collect some of it down the line but not the British government.

  4. Re:Good for them. by pr0nbot · · Score: 3, Interesting

    Absolutely! Governments don't ever do anything for me, whereas corporations bend over backwards to keep me happy, I'd much rather they got my dollars.
    P.S. Nice to see Ron Swanson is on Slashdot.