The UK Government walked up to the big American company with empty bowl in hand and asked…”Please sir, can I have some more?”
This is the situation we now find ourselves in, with many of these big American companies paying virtually zero tax but with the UK government pretty much powerless to do anything about it.
Take Google for example, who experts have recently claimed they got away with paying £1.5 BILLION in UK tax last year.
Not exactly small change is it? Some pundits have even described Google as the “Artful Dodger.”
So how do Google get away with it, year after year? Apparently they funnel money from UK AD sales and other income to different Google branches around the world. For example, a pound made in the UK could be funnelled to the Google India Branch.
This is what experts are claiming. Who knows for sure? Innocent until proven guilty is what we say here at CA.
Also, let’s not forget that Google probably also arm themselves to the teeth with the best accountants money can buy.
Is it fair? No. But in the war of paying less tax then fair doesn’t even come into the equation.
If you can get an unfair advantage by hiring the best contractor accountant, then would you take it? I’m willing to bet most contractors reading this would say yes, and there is nothing wrong with that, as long as everything is done legally and above board.
The contractor accountants you can find right here on this website don’t work for Google and they don’t do anything illegal…but they are “in the know” when it comes to helping you pay less tax.
Back to the Google story, and according to the Tax Justice Network, if Google were to reveal all of its UK AD sales then the real turnover would be £9.7 BILLION pounds.
Instead, they only put down £1.4 BILLION pounds for last year, which means all of that extra income was sent off around the globe to other branches of the Google empire. Apparently.
This means that Google only paid £67 million pounds last year in tax. That is less than the price of a decent Premiership football player.
Instead, they should have paid £1.5 BILLION pounds according to the Tax Justice Network. That is about the cost of the Manchester City subs bench.
While it is frustrating to see Google and other American companies get away with BILLIONS of pounds every year, what can you, the average UK contractor do about it?
Nothing. The only thing you can do is to focus on yourself and find ways to legally pay less tax using a contractor accountant.