Facebook pays no UK corporation tax for a second year
Facebook paid no UK corporation tax for the second year in a row in 2013, while employees received shares in the company worth tens of millions of pounds.
The world’s largest social media company reported a pre-tax loss of £11.6m in the UK last year, despite its US parent company reporting a net profit of $1.5bn (£900m).
UK revenues rose from £34.6m to £49.8m, according to Facebook UK’s latest financial filing at Companies House published on Wednesday.
Facebook UK classifies its turnover as “marketing and engineering services”, because much of the company’s ad revenues are funnelled through Ireland to take advantage of much lower tax rates.
The company made £371m in advertising revenue last year, a 67% year-on-year rise from the £222m in 2012, according to research firm eMarketer.
Facebook UK incurred a corporation tax charge of just £3,169, and received a credit of £182,000.
The company employed an average of 172 UK staff, who were paid £40.8m last year, almost double the 2012 figure of £21m. This is because of a £15.5m payment cost for “share-based payments”.
UK staff received 1.52m free Facebook shares worth $118m at their current share price of about $78.
There were also 2.2m shares worth more than $170m “outstanding” as at 31 December.
The government has promised a change in the law to crack down on offshore tax avoidance.
Source: Facebook- Facebook pays no UK corporation tax for a second year
