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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

#331

Post by rstupek »

kuschku wrote: post #303
phlo wrote: post #273

Earlier quoted context omitted.

Stories like this make me question if corporate tax even makes sense. However well designed, a tax code with today's complexities is going to have holes. If a savings of even one per mill may mean millions, corporations are going to spend insane amounts of money to hire the best experts to use every last loophole. Why don't we cut down everything to a couple of manageable groups that can be tightened down? I think th…

So, in your system, how would a corporations profits be taxed? You have shown nothing like that, really. And a direct property tax is also not a good idea, as then you tax people for having property, not for using their property.

You shouldn't tax corporations as it is simply an indirect tax on individuals. A good way to hide a persons total tax rate by making part of it be included in the goods they purchase.

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

#332

Post by collyw »

marknutter wrote: post #204
tomelders wrote: post #173

Earlier quoted context omitted.

I utterly reject this argument > 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 is the average salary at Facebook UK, it's likely much higher. First of all, that's Facebook employees paying tax. Not Facebook. That's their money that they are taxed on and they pay it. Secondly, no one is asking for Facebook to p…

> First of all, that's Facebook employees paying tax. Not Facebook. That's their money that they are taxed on and they pay it. Why is this distinction even relevant? Facebook then needs to pay its employees more to make up for the difference. No matter who the government taxes, everyone involved will shift their habits to compensate for it.

Lets face it, if they haven't found a way to avoid that one.

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

#333

Post by collyw »

collyw wrote: post #274
pjc50 wrote: post #227

Earlier quoted context omitted.

Standard Oil? If you're going to call that "crony capitalism", we're well into the same delusional territory as "true communism has never been tried".

when was it tried?

I love it when an honest question gets downvoted on here.

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

#334

Post by yrro »

kuschku wrote: post #317
yrro wrote: post #220

Earlier quoted context omitted.

But they are playing Corporation Tax. To put it another way... what additional tax do you want them to pay that they are currently not paying?

The full corporation tax, on their share of their worldwide income generated in britain.

But corporation tax is charged on profit, not income.

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

#335

Post by to3m »

oliwarner wrote: post #313

It's a good headline but in this case, HMRC made somewhere between two and five times as much money through Facebook's accounting choice here than had they kept the money as corporate profit. That's because the Facebook paid out those profits to employees as bonuses. That wiped out the corporate profit but the employees have paid income taxes which are much, much higher than corporation tax. This is significantly dif…

I wonder what the response would have been had it turned out Facebook were going to pay their employees less, because they'd be making more profit that way ;)

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

#336

Post by bduerst »

legitster wrote: post #327
phlo wrote: post #273

Earlier quoted context omitted.

Stories like this make me question if corporate tax even makes sense. However well designed, a tax code with today's complexities is going to have holes. If a savings of even one per mill may mean millions, corporations are going to spend insane amounts of money to hire the best experts to use every last loophole. Why don't we cut down everything to a couple of manageable groups that can be tightened down? I think th…

Someone put it best when they said "corporations may not have a heart, but they don't have a stomach either". Unlike people, corporations do not consume for the sake of consumption, instead they invest in assets. A tax on corporations is directly passed through to employees, customers, investors etc. From what I understand, the actual proposed replacement for the corporate income tax is much simpler: eliminate it and…

What about the majority of companies that don't pay dividends? I agree that tax codes are complex and the international theater makes them hard to enforce, but most of the proposed replacements for corporate income tax are typically half-baked.

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

#337

Post by ropiku »

spacecowboy_lon wrote: post #200
ropiku wrote: post #102

Earlier quoted context omitted.

The cap gain is only paid on the profit made when selling. RSUs are taxed as regular income when they are awarded. Most likely the employees are high rate tax payers so it comes out at 40-45% tax + National Insurance.

Sorry what is this RSU you speak of? tax on employee share options is quite different in the UK to the USA. With a HMRC approved scheme CGT effectively goes away and you only pay CGT after your yearly allowance and only on a real gain - no massive tax bill on underwater share options.

The other repliers added more info, sorry.

You are correct about share options, on which your gain is only the price difference for which you pay CGT (or not). But the liquid tech companies (Google, FB, Twitter) give out direct stock which is taxed on their Fair Market Value at the time of vesting. RSUs are taxed the same way both in UK and US.

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

#338

Post by phlo »

kuschku wrote: post #325
phlo wrote: post #315

Earlier quoted context omitted.

Sorry, I might not have made that point clear: they wouldn't be taxed at all. Not at the corporate level, that is. As far as I can tell, money will exit corporations in three ways: 1) salary, 2) shares and 3) payments for goods/services, mostly to other corporations. Income and capital gains taxes will take care of 1 and 2. The company won't owe taxes, but whichever natural person receives the money will. As for 3, m…

And how do I tax a shareholder living in US if I’m the UK government? I have no ability to do so.

One possibility might be to charge capital gains whenever shares are traded. Then require shares to only be traded at exchanges with an agreement to report trades (or anonymously collect capital gains and send them your way, for privacy). Another (probably worse) alternative might be not to tax them. The US will, and in exchange you get to tax UK shareholders of US companies.

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

#339

Post by phlo »

bduerst wrote: post #336
legitster wrote: post #327

Earlier quoted context omitted.

Someone put it best when they said "corporations may not have a heart, but they don't have a stomach either". Unlike people, corporations do not consume for the sake of consumption, instead they invest in assets. A tax on corporations is directly passed through to employees, customers, investors etc. From what I understand, the actual proposed replacement for the corporate income tax is much simpler: eliminate it and…

What about the majority of companies that don't pay dividends? I agree that tax codes are complex and the international theater makes them hard to enforce, but most of the proposed replacements for corporate income tax are typically half-baked.

Either (as the parent comment proposes) force them to pay dividends. Or don't: in order to profit from the higher share price, investors either have to sell some of their shares (realizing their capital gains) or use them as collateral for a loan (which should be treated as a capital gains realization event).

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

#340

Post by bduerst »

phlo wrote: post #315
kuschku wrote: post #303

Earlier quoted context omitted.

So, in your system, how would a corporations profits be taxed? You have shown nothing like that, really. And a direct property tax is also not a good idea, as then you tax people for having property, not for using their property.

Sorry, I might not have made that point clear: they wouldn't be taxed at all. Not at the corporate level, that is. As far as I can tell, money will exit corporations in three ways: 1) salary, 2) shares and 3) payments for goods/services, mostly to other corporations. Income and capital gains taxes will take care of 1 and 2. The company won't owe taxes, but whichever natural person receives the money will. As for 3, m…

This type of tax plan will incentivize wealth aggregation in corporations, while increasing the cost of employees and goods/services.

You want companies to spend, to increase economic cash flow and generate jobs, which is why existing corporate taxes are on net income, not revenue or costs.

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