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Microsoft is accused of not paying UK corporation tax

Funnels money through Ireland and Luxembourg
Mon Dec 10 2012, 16:03
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SOFTWARE FLOGGER Microsoft has been accused of not paying UK corporation tax despite raking in revenues of £1.7bn in the UK.

Microsoft's complex tax arrangements that span Ireland and Luxemburg have been the focus of scrutiny in the past and now in the wake of Amazon, Google and Starbucks, the firm has once again been questioned over the tax it pays, or rather, doesn't pay. A number of news reports, including one at the Telegraph, claim the company did not pay corporation tax on UK revenues of £1.7bn.

Microsoft's operations in the UK come under the umbrella of Microsoft Ireland Ltd, which unsurprisingly is registered in Ireland where corporation tax laws are considerably more favourable for businesses. According to reports Microsoft's Irish operations booked revenues of £1.7bn from sales in the UK yet it allegedly hasn't paid a penny of UK corporation tax.

Microsoft issued a statement in which it claimed to have abided by all laws. The firm said, "Microsoft pays all due taxes, as required by law, worldwide. Microsoft subsidiaries are fully subject to tax in the jurisdictions in which we operate. We are regularly audited by major tax jurisdictions, which ensure the company is complying with all rules and regulations."

The INQUIRER asked Microsoft to confirm whether it had paid any UK corporation tax, a question the firm did not answer. However the firm sent a statement in which said that it abides by all tax laws.

A Microsoft spokesperson said, "Microsoft pays all due taxes, as required by law, worldwide. Microsoft subsidiaries are fully subject to tax in the jurisdictions in which we operate. We are regularly audited by major tax jurisdictions, which ensure the company is complying with all rules and regulations."

Amazon, Google and Starbucks have been accused of dodging UK corporation tax and while reports cite Microsoft's UK revenue, corporation tax is only paid on profits. Given that Amazon, Google, Starbucks and Microsoft all have audited accounts that have been given the seal of approval by the UK government tax authority, perhaps the Treasury or Parliament should be taking the heat for allowing these large multinational companies to legally get away with paying little to no taxes. µ

 

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