BusinessFacebook UK pays £29m corporation tax on record £3.3bn...

Facebook UK pays £29m corporation tax on record £3.3bn sales

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Fb’s UK operations paid £29m in company tax final 12 months regardless of reporting a report £3.3bn in gross sales, whereas its common workers pay rose to £262,000.

The social media firm’s newest accounts for its London-based arm confirmed gross earnings from advertisers surged by greater than 37% final 12 months from £2.4bn to £3.3bn.

Its mum or dad firm, Meta, which additionally owns Instagram and WhatsApp, is the second-largest participant within the UK digital promoting market, after Google.

The Corporations Home submitting for Fb UK, which describes itself as a supplier of gross sales help, advertising and marketing companies and engineering help to the Meta group, reported £229.5m in pre-tax earnings final 12 months. This was up greater than a fifth on the £190m the corporate made in 2020.

The corporate paid £29.8m in UK company tax final 12 months, down on the £36.7m it paid the 12 months earlier than. Fb mentioned it spent £1.8bn on gross sales help, advertising and marketing companies and engineering help companies.

Fb UK’s tax cost was £69.7m final 12 months, nevertheless deductions together with a tax credit score of greater than £32m meant the corporate paid far much less.

“During the last 12 months we’ve continued to put money into the UK, together with opening a brand new workplace campus in King’s Cross [in London],” mentioned a spokesperson for Meta. “Whereas we paid $8.52bn [£7.65bn] in company tax globally final 12 months, and our common efficient tax fee over the past decade was round 20%, underneath present guidelines the overwhelming majority of that is paid within the US.”

Whereas Meta is now contemplating job cuts amid a slowdown in development amongst huge tech corporations, its UK operation was on a hiring spree final 12 months.

Its workforce grew 37% from 3,745 to five,148 workers because the operation agreed leases on two new workplace websites, and prolonged an present lease in London.

Because of this, Fb UK’s workers invoice soared by 46% year-on-year to £1.35bn, with workers receiving £458m in share-based funds. The corporate’s UK workers earned a median of £262,000 every final 12 months, up 6% from £247,400 the 12 months earlier than.

Like its tech friends Amazon and Google, Meta is often the goal of criticism that it doesn’t pay sufficient in tax within the UK.

Analysts at Insider Intelligence estimate that in complete Meta took £6bn in UK ad spend final 12 months.

In 2020, the UK launched a digital companies tax, which levies 2% of gross revenues and aimed to focus on massive digital corporations that make large revenues however report comparatively small earnings.

Subsequent 12 months, it will likely be changed by a brand new international tax system after the Organisation for Financial Co-operation and Improvement brokered a deal between 136 nations that can end in massive multinational corporations paying tax within the nations the place they do enterprise, and committing themselves to a minimal 15% company tax fee.

“Though we pay the required degree of taxes underneath worldwide tax guidelines, we perceive there’s frustration about how multinational corporations are taxed and have lengthy known as for reform of the worldwide tax system,” mentioned the Meta spokesperson. “We hope to see additional progress in direction of implementing the OECD’s tax settlement, which may imply corporations like Meta paying extra tax, and elsewhere.”

Earlier this week, it emerged that Google paid £200m in UK company tax on pre-tax earnings of £1.1bn within the 18 months to finish of December.

The corporate reported £3.4bn turnover for the interval. Analysts at Insider Intelligence estimate Google, which additionally owns YouTube, took £8.6bn complete revenues within the UK final 12 months.

Google UK’s greater than 5,700 workers earned a median of greater than £385,000 every over the 18-month interval, partially due to nearly £1bn in share-based funds.




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