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Facebook to Reduce UK Tax Bill by Increasing Staff Bonuses

Facebook is planning to award up to £280 million ($369 million) in UK staff bonuses to reduce the amount of tax they are forced to pay to the British Treasury, a Sunday Times investigation has revealed.

The firm’s UK employees will receive an average of £775,000 ($1.1 million), which Facebook will then be able to list as a taxable expense.

The news comes just days after it was revealed that the company was set to pay millions of pounds in additional UK tax after a major structural overhaul, having come under pressure after years of avoiding the taxes.

Part of that plan was to no longer divert profits to Ireland, where business tax rates are lower, and move them back to the UK. Facebook claimed the move would “provide transparency to Facebook’s operations in the U.K.”

The news will come as a blow to Chancellor George Osbourne and the British Government, who are attempting to tackle the problem of large scale corporate tax avoidance in the UK.

Facebook was shown to have paid just £4,327 in UK corporation tax in 2014.

The firm is estimated to make an average annual $4 billion profit, although they refuse to reveal their financial accounts for their operations within the UK.

You can follow Ben Kew on Twitter at @ben_kew or email him at ben@yiannopoulos.net

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