Re:Apple to Pay £3.8m Tax on £1.2bn UK Sales
by mytailorisrich on Monday July 01, 2019 @11:14AM
(#20326130)
In the UK corporate tax is payable on profits before dividends, so Apple (UK) paid corporate tax at a rate of 19% on that £13m dividend. That's about £2.5m.
The trick is that taxable profit is a quantity that can be 'optimised'.
A large international company like Apple is in fact many companies incorporated in many countries and as such they can 'move' profits to low tax jurisdictions by, e.g. having their Irish subsidiary provide services/goods to their subsidiary in the UK. That creates a cost for the UK company, whereby decreasing its profit and creates an income to the Irish company, whereby increasing its profit.
The trick is that taxable profit is a quantity that can be 'optimised'.
A large international company like Apple is in fact many companies incorporated in many countries and as such they can 'move' profits to low tax jurisdictions by, e.g. having their Irish subsidiary provide services/goods to their subsidiary in the UK. That creates a cost for the UK company, whereby decreasing its profit and creates an income to the Irish company, whereby increasing its profit.