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Facebook paid £4,327 corporation tax in the UK in 2014

bbc.co.uk

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Re: Facebook paid £4,327 corporation tax in the UK in 2014

#91

Post by nr152522 »

"It means Facebook's UK corporation tax bill was less than the tax the average UK employee paid on their salary."

"The average UK salary is £26,500 on which employees pay a total of £5,392.80 in income tax and national insurance contributions."

Corporation tax and personal tax are not the same thing so I don't see how they can be compared. In fact, in terms of taxes paid to HMRC, they would have been paid more tax overall.

However, considering they made a pre-tax loss, they should have probably reviewed those payouts of which I assume was shared amongst those on top.

Re: Facebook paid £4,327 corporation tax in the UK in 2014

#92

Post by SmellyGeekBoy »

TomGullen wrote: post #82
SmellyGeekBoy wrote: post #79

Earlier quoted context omitted.

I'm a one-man-band and I paid about double the corporation tax Facebook did in 2014. My turnover isn't even high enough to register for VAT. Really makes you think!

Just FYI, when you do need to register for VAT make sure you check out the benefits of Flat VAT, for us it was significantly more economical then regular VAT registration. I'm constantly surprised how many accountants don't seem to even make their clients aware of this option.

Thanks for the advice. I was pretty close to the threshold last year and it's looking likely I'll have to register this year so I'll certainly look into it. I'm actually between accountants at the moment, although HMRC's own PAYE RTI app at least makes that side of things ridiculously easy for me. I certainly wasn't looking forward to dealing with VAT on my own.

Re: Facebook paid £4,327 corporation tax in the UK in 2014

#93

Post by raverbashing »

jkahn wrote: post #12

Global companies offshoring profits and not paying enough tax (in the eyes of many countries) was a hot topic at the last G20 summit in Brisbane. This isn't limited to Facebook, as the article explains. The issue and background here is that when large companies operate globally, each country has its own local subsidiary, owned by the global entity. Money is made in each country by selling goods or services. How are t…

Well, how much Apple money stays outside of the US because it was paid there?

Also, how much VAT and other taxes are charged in an iPhone sold in Europe

Same for Facebook, their ads generate VAT. Their employees there pay income tax.

Re: Facebook paid £4,327 corporation tax in the UK in 2014

#94

Post by notahacker »

mrkmcknz wrote: post #18

The UK press seems to have a field day when it comes to multi-national corporations not paying corporation tax. We will no doubt shortly have a number of MPs telling us how unacceptable this is and that Facebook need to start paying up. This all irks me a little. 362 Facebook staff on an average salary of say £65,000 will contribute at least £7,230,696.60 in taxes and NI to HMRC. Let's also not pretend that £65,000 i…

I don't think it's advocacy of "aggressive taxation policies" to argue that the corporation tax bill for a profitable multinational earning millions in UK revenue ought to be higher than the income tax bill for an individual person on the UK average wage. YMMV.

How many of Facebook's 362 UK staff would be unemployed for any significant period if they relocated to Dublin? How many would instead be adding value to a company that paid 20% corporation tax, whilst paying similarly high taxes on a similarly high salary?

Re: Facebook paid £4,327 corporation tax in the UK in 2014

#95

Post by 100timesthis »

switch007 wrote: post #35
mrkmcknz wrote: post #18

The UK press seems to have a field day when it comes to multi-national corporations not paying corporation tax. We will no doubt shortly have a number of MPs telling us how unacceptable this is and that Facebook need to start paying up. This all irks me a little. 362 Facebook staff on an average salary of say £65,000 will contribute at least £7,230,696.60 in taxes and NI to HMRC. Let's also not pretend that £65,000 i…

> 362 Facebook staff on an average salary of say £65,000 will contribute at least £7,230,696.60 in taxes and NI to HMRC Let's not pretend all 362 Facebook staff are paying tax via PAYE.

maybe stupid question: do you expect a lot of fake contractors or there is another way? Because if they are contractors they wouldn't be part of those 362 in staff right?

Re: Facebook paid £4,327 corporation tax in the UK in 2014

#96

Post by mootothemax »

kuyfiuyg wrote: post #19

I'm asking someone who is more knowledgeable than me on this topic. What would happen if you replace all (most) tax with VAT? That would mean everywhere there is a real transaction, that generates greater value, that is where the tax is. It would also make it impossible for big companies to do tax evasion - since you limit the effects to the 'leaves' of the tree that is the economic system, you can catch the money be…

>What would happen if you replace all (most) tax with VAT?

I'd imagine a large number of people would form sole-trader companies and put every last expense possible through it.

A boon for accountants!

Re: Facebook paid £4,327 corporation tax in the UK in 2014

#97

Post by ams6110 »

snorrah wrote: post #73

Shameful. Just shameful. I don't care how it gets sugar coated, if you claim to be working for the good of humanity (in facebooks case by connecting people together) and then you loophole yourself out of paying taxes, you are morally bankrupt.

If the tax law allows it, they have no reason to pay more than they do. To do so would be not in the interests of their owners/shareholders.

If you have a problem with tax "loopholes" then fix the tax law. Don't blame a business for paying only the tax it is legally obligated to pay. Would YOU pay more taxes than you have to?

Re: Facebook paid £4,327 corporation tax in the UK in 2014

#98

Post by mootothemax »

DanBC wrote: post #4

No-one expects companies to pay the full whack of tax. But Facebook is taking the piss. They need to be a bit careful, because they risk causing much tighter tax regulation in EU. Citizens don't see this behaviour and think "well done, got one over on the government". Most citizens are infuriated by this scumbag behaviour. And before anyone says "they're just obeying the law" -- we don't know that. They're clearly no…

>But Facebook is taking the piss.

Exactly, they take it from "mild annoyance about the state of the world" through to full-on rage.

I'd like to know whether - annoyingly - even if they knowingly bought about huge tax reform, whether the short terms gains of doing this now would still make it worthwhile. Sadly, I can't see any way that it's not worth abusing whenever possible.

Re: Facebook paid £4,327 corporation tax in the UK in 2014

#99

Post by arethuza »

stegosaurus wrote: post #68

Re-posting my comment from the Guardian thread that came up earlier ( https://news.ycombinator.com/item?id=10371728 ) Corporation tax in the UK is payable on 'profits subject to corporation tax'. In laymen's terms this is roughly equivalent to to accounting profit. Employee salaries, bonuses, etc are generally deductible; if you pay me 50K, that's 50K out of your bottom line. The employees in question likely pay a va…

Shareholders are generally pretty keen on the "existence" of a corporation when it comes to limited liability.

Re: Facebook paid £4,327 corporation tax in the UK in 2014

#100

Post by krotton »

jkahn wrote: post #85
krotton wrote: post #70

Earlier quoted context omitted.

Well, in hypothetical laissez-faire capitalism taxes would not be needed to provide infrastructure - Uber would just have to pay its fees for driving on private roads (etc.). This would drive prices up, but fairly divide the costs between the roads' users. Although I must admit I have no idea how things could look with purely digital companies like Facebook. I can think of local ISP-s charging the company for allowin…

That's theoretical, whereas government and corporations deal with realities. 100% capitalism isn't practical and is unfair (e.g, to the poor and sick). What is a fair way to divide costs for road usage: time of use, miles driven, emissions, cost of vehicle, ability to pay? It's not an easy answer, and many are practically unenforceable. Hence, tax. And for the record: I'm generally capitalist by economic viewpoint.

The way road usage costs are determined doesn't really matter - it's enforced by a mutually accepted contract. Yes, that's theoretical ;).
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