Apple has been under heavy scrutiny the past few months for its tax practices and off-shore cash pile, but the criticism that Apple isn’t paying enough taxes isn’t likely to stop thanks to a new report that claims Apple paid zero corporate tax in the United Kingdom last year.
According to a report from the Financial Times, Apple was able to avoid paying corporate taxes in the UK last year by using tax deductions from share awards to employees that basically offset the amount of taxes Apple owed through September 2012, all of which is completely legal.
Apple reported that it’s profits from UK subsidiaries totalled £68 million before taxes, but it netted $36.3 billion of sales in Europe in 2012, $15 billion of which was operating profit. Apple also funneled money into offshoots in countries with lower-tax rates like British Virgin Islands while enjoying a 2% tax rate on overseas profits.
Tim Cook appeared before the US Senate sub-committee in May to testify of Apple’s tax practices in the U.S. Cook noted that all of Apple’s accounting practices are within the bounds of the US tax code, but the company used an Irish ghost company to avoid paying taxes on $78 billion over four years.
Source: The Financial Times
Buster Hein is a freelance writer who lives in Phoenix, Arizona. Twitter: @bst3r.
9 responses to “Apple Paid Zero Corporate Tax In UK Last Year Thanks To Loopholes”
Why is it a problem then if it’s legal?
Why is it a problem then if it’s legal?
It just spotlights how the entire tax code around the world is wrong.
Socialist countries mad because they can’t steal part of the pot Apple legitimately earned by selling great products.
Well I feel these companies should be paying more, why does this article read like Apple is in trouble? Just like in the US, the politicians are the ones that need to do something about it. Until the politicians stop cozying up to big business, companies will continue to do this; and it’s not limited to just Apple, by the way.
Tax laws are made for the rich, who can afford to find the loopholes and not pay taxes. White collar workers do not have the same loopholes and can never find themselves in a situation where they could use a loophole, it’s BS. APple, and all corporations should be required to pay a fair share of taxes and should be taxed heavier, they can afford it.
Get a good tax preparer or accountant, and you’ll be surprised of all the legal loopholes that are available for the every day white collar workers.
It just spotlights how the entire tax code around the world is wrong.
Exactly. But this article insinuates that Apple should be locked up or something.
If Apple did nothing illegal what’s the problem? Name one person or entity that pays more taxes than they knowingly have to?