Facebook

Facebook to overhaul Irish tax scheme

Posted on

Source: BBC.co.uk 12 December 2017

“Facebook is to overhaul its tax structure so that it pays tax in the country where profits are earned, instead of using an Irish subsidiary.

The online advertising giant is to make the change in every country outside the US where it has an office.

However, that does not necessarily mean it will start paying more tax in other countries as a result of the overhaul, Professor Prem Sikka of the universities of Sheffield and Essex told the BBC.

Taxes are paid on profits, and “the huge difficulty with large companies is trying to determine exactly what the profit is,” he said.

There are a number of ways firms can muddy the waters, including charging intra-group management fees, royalty fees, and profit-sharing, he said.”

source article here

 

Advertisements

Facebook could owe $5 billion in back taxes

Posted on

Source: Washington Post, 29 July 2016

Facebook is digging in over its fight with the Internal Revenue Service. The social network said this week that it faces a potential $5 billion tax bill after moving some of its assets to Ireland.

The company’s tussle with tax authorities dates back to its decision in 2010 to transfer many of its global “intangible” assets — those not in the United States or Canada — to its Irish holding company. The transfer allowed the company to pay a lower tax rate on the profits made from those assets, tax experts say. (The corporate tax rate in Ireland is 12.5 percent, compared with 35 percent in the United States.)

Washington Post story here