Corporate Tax Dodgers: The UK’s Worst OffendersJanuary 21, 2016
The recent years have seen a spike in the number of multi-millionaire corporations being shamed in the media for avoiding paying their taxes on sales made in Britain. With last month’s article showing how important our tax money is for the upkeep of the country, we’re taking a look at the biggest exposes in recent years to find out who is the UK’s worst offenders for avoiding tax payments.
Is it legal?
Whilst the ethical ramifications of tax avoidance is a hotly debated topic, tax avoidance is infact legal, and on a much smaller scale, even encouraged; tax-free Individual Savings Accounts (ISAs) allow individuals to put their income to one side without paying tax on the interest, and there are also financial advantages from day-to-day tasks such as donating money through gift aid to claiming capital allowance on business related expenses. Tax avoidance is entirely above board, but tax evasion is illegal. The difference between the two comes down to intent; tax avoidance involves bending and manipulating the tax rules to your benefit, whilst tax evasion is a deliberate attempt to cheat the taxman and disguise the income you have in order to reduce or entirely avoid paying your due taxes.
Starbucks: In the last year alone, Starbucks had accumulated £400 million in UK sales, but shockingly paid no corporation tax, avoiding its dues by transferring money to a Dutch sister company and buying produce from foreign countries.
Google: Despite a turnover of £395 million in the UK, Google paid just £6 million of tax in 2011.
Amazon: The global phenomenon and online retailer, Amazon, has UK sales of £3.35 billion in 2011 and yet only reported a £1.8 million ‘tax expense’.
Gary Barlow: Former Take That frontman, Gary Barlow, along with two other members of the band invested at least £66 million into a tax relief scheme propagandising as a music industry investment scheme. It is reported that the band still owe the taxman £20 million a year after the scheme came to light.
Vodafone: After Vodafone sold its stakes in an American mobile phone company for £84 billion and received its payments tax free, the Treasury was put under pressure to review the rules around corporation taxes to prevent UK taxpayers missing out.
TopShop: In order to avoid tax payments, the founder and billionaire, Philip Green, paid his wife in Monaco a £1.28 billion dividend, although Green claimed he had legally paid all of the taxes his company owed, totalling £2.3 billion over the past 10 years.
While these represent some of the more high profile cases of tax avoidance within the UK, it is most definitely not a comprehensive list, and tax avoidance is an ongoing issue within the country that is becoming more frequently publically shamed.
If you require assistance in getting to grips with your corporate tax, look no further than Murray and Lamb for a professional and expert service. Operating throughout the North East of England, we have years of experience in all aspects of corporation tax and can work to ensure that your company is paying the correct amount of tax and complying to corporation tax legislations. To find out more, contact one of our friendly advisors today and we’ll be happy to help.This entry was posted in Accountancy Advice, Business News, Corporation Tax. Bookmark the permalink. ← Why Should I Use Payroll Software? Getting Self-Assessments Right: A Walkthrough →