Facebook paid £4k in tax. HMRC then paid Facebook £27k – for ads

Free content ad network says it'll pay much more tax in future, though. So that's OK


Facebook is to pay millions more in taxes in the UK, a day after it was revealed that HMRC paid Facebook six times more to advertise on the site than the ad platform paid HMRC in taxes during 2014, according to reports.

Facebook is, it says, undergoing a major overhaul of its tax structure.

A spokesman for the free content ad network told The Register: "On Monday we will start notifying large UK customers that from the start of April they will receive invoices from Facebook UK and not Facebook Ireland. What this means in practice is that UK sales made directly by our UK team will be booked in the UK, not Ireland. Facebook UK will then record the revenue from these sales."

It said the that profits from the majority of Facebook's advertising revenue initiated in Britain will now be taxed in the UK and the company will no longer route sales through Ireland for its largest advertisers.

"In light of changes to tax law in the UK," continued Facebook's spokesman, "we felt this change would provide transparency to Facebook's operations in the UK. The new structure is easier to understand and clearly recognises the value our UK organisation adds to our sales through our highly skilled and growing UK sales team."

In 2014 Facebook paid £4,327 in tax. However, according to a Freedom of Information response to Channel 4 News yesterday, the company was paid £27,000 by HMRC the following year for to place adverts on its site telling people to pay their tax.

A Facebook spokesman told Channel 4: "We are compliant with UK tax law and in fact all countries where we have employees and offices."

HMRC told the programme: "Like all large organisations we find that an increasing number of those we serve communicate through and get their information from social media. Our investment in social media is carefully evaluated to ensure we are getting maximum value for the taxpayer."

The British government has said it may reopen its tax settlement with Google if it appears that HMRC has "settled for less corporation tax than other countries are willing to accept.".

Google has also faced criticism for its £130m ten-year back tax settlement with HMRC. It was also widely reported that France is seeking €1.6bn (£1.2bn) in back taxes from U.S.

Facebook currently employs 850 people in the UK and is building a new headquarters in London. ®


Other stories you might like

  • Giant outsourcer keeps work from home, loses tax breaks. Government says 'good riddance'
    Philippines says subsidies inflate profits, not local economy

    The government of the Philippines has welcomed the decision by giant business process outsourcer Concentrix Corporation to forgo tax incentives and instead allow its staff to continue working from home for the foreseeable future. The nation feels that subsidising outsourcers' bottom lines does nothing to boost the local economy.

    The Philippines imposed lengthy and strict COVID-19 lockdowns that saw its substantial business process outsourcing sector quickly adapt to working from home. The nation's government supported that move by continuing to offer the pre-COVID subsidies it offered to outsourcers that run offices located in certain special economic zones.

    Those subsidies have subsequently been removed, and the requirement to operate from special economic zones restored.

    Continue reading
  • Meta agrees to tweak ad system after US govt brands it discriminatory
    And pay the tiniest of fines, too

    Facebook parent Meta has settled a complaint brought by the US government, which alleged the internet giant's machine-learning algorithms broke the law by blocking certain users from seeing online real-estate adverts based on their nationality, race, religion, sex, and marital status.

    Specifically, Meta violated America's Fair Housing Act, which protects people looking to buy or rent properties from discrimination, it was claimed; it is illegal for homeowners to refuse to sell or rent their houses or advertise homes to specific demographics, and to evict tenants based on their demographics.

    This week, prosecutors sued Meta in New York City, alleging the mega-corp's algorithms discriminated against users on Facebook by unfairly targeting people with housing ads based on their "race, color, religion, sex, disability, familial status, and national origin."

    Continue reading
  • Metaverse progress update: Some VR headset prototypes nowhere near shipping
    But when it does work, bet you'll fall over yourselves to blow ten large on designer clobber for your avy

    Facebook owner Meta's pivot to the metaverse is drawing significant amounts of resources: not just billions in case, but time. The tech giant has demonstrated some prototype virtual-reality headsets that aren't close to shipping and highlight some of the challenges that must be overcome.

    The metaverse is CEO Mark Zuckerberg's grand idea of connected virtual worlds in which people can interact, play, shop, and work. For instance, inhabitants will be able to create avatars to represent themselves, wearing clothes bought using actual money – with designer gear going for five figures.

    Apropos of nothing, Meta COO Sheryl Sandberg is leaving the biz.

    Continue reading

Biting the hand that feeds IT © 1998–2022