Apple pays extra £136m tax after HMRC audit
Tech giant Apple has paid an additional £136m in tax and interest payments to the UK tax authorities following an ‘extensive audit’ by HMRC, according to records filed at Companies House
10 Jan 2018
In a note to the full accounts to 1 April 2017 for its subsidiary for Apple Europe Ltd, prepared by auditor EY, the company states: ‘Following an extensive audit by HMRC, the company agreed to pay a corporate tax adjustment of £136m covering prior years up to September 26, 2015.
‘This payment of additional tax and interest reflects the company’s increased activity and is recognized in the current financial period which ended on 1 April 2017.
‘As a result of this adjustment the company’s corporate income tax payments will increase going forward.’
Apple Europe provides sales support, marketing, financial and administrative services to other group companies. The company employs 791 people and made a pre-tax profit of £297m in the 18 months to April 2017. The total tax charge was £192m.
Apple’s tax arrangements have come under fire over its policy of routing sales and marketing payments via a lower corporate tax regime in Ireland. Following an EU ruling that the tech giant had benefited from illegal state aid, Apple reached an agreement with the Irish government to start paying €13bn (£11.5bn) in unpaid taxes.
In a statement HMRC said: ‘We do not comment on the tax affairs of individual companies. Multinational companies must pay all taxes due and we don’t settle for less.
‘Last year alone, HMRC secured and protected over £8bn in additional tax revenue from the largest and most complex businesses.’
Apple said: ‘We know the important role that tax payments play in society. Apple pays all that we owe according to tax laws and local customs in the countries where we operate.
‘As a multinational business and the largest taxpayer in the world, Apple is regularly audited by tax authorities around the world. HMRC recently concluded a multiyear audit of our UK accounts and the settlement we reached with HMRC is reflected in our recently filed accounts.’
At the beginning of 2016, tech multinational Google agreed to pay £130m in back taxes after an ‘open audit’ of its accounts by the UK tax authorities. The payment covered tax owed since 2005 and followed a six-year inquiry by HMRC.
Report by Pat Sweet