Facebook under fire: World's largest social network paid £4,327 in UK tax last year

Facebook’s 362 UK employees earn an average of £210,000 annually and they received over £35m in a share bonus scheme .

Yet, the world’s largest social networking site paid a measly 4,327 in corporation tax in the UK last year.

The average UK worker pays £5,393 annually in taxes.

This is because Facebook showed that its operating at a loss in the UK, thereby diminishing its tax bill.

Before you get annoyed, we’ll set the record straight: Facebook hasn’t done anything illegal, it’s compliant with the UK tax laws.

Facebook’s international HQ for the UK region is based in Ireland and its tax arragements are made through Cayman Islands.

In a statement to The Sunday Times, 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.”

John O’Connell, director of the TaxPayers’ Alliance, said: “Taxpayers will be justifiably confused and angry about this low tax bill.

“But the problem lies with our complex tax code, and that is what politicians should address as a matter of urgency. We have to ensure our taxes are simple to eliminate loopholes.”

 

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Readers' comments (2)

  • Anonymous

    Income tax must only be paid in the country where the income is generated, the country where you spend your income gets VAT.

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  • Its not surprising, remember UK users are actualy the product. i.e. they are being sold to advertisers.

    We need a new set of tax laws to deal with this type of company/product, but no easy answer as it will need a global solution.

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