Google tax

[d000hg]

I thought in these cases the issue were companies doing business in country A, then diverting the money to country B... your example seems to suggest nothing much artificial.

[Batcher]

I thought it had been proved that Google had a large team in London selling advertising to UK companies but had some sort of convoluted system so that the tax was due at HQ in Dublin?

[VectraMan]

From 1 April next year companies will be required to tell tax officials if they believe they may be liable for the levy based on how they channel money out of the country.
The 25pc diverted profits tax will apply when a company does not have a permanent UK establishment but supplies goods and services to British customers. It will also apply to companies that do have a permanent UK arm but avoid corporation tax by paying fees to other subsidiaries within the group outside the country.

For instance Google's 'double Irish' arrangement would meet both conditions. It has a permanent UK arm and large London staff but pays very little corporation tax because its British sales transactions are made by an Irish subsidiary. The profits are then shifted to another subsidiary in Bermuda as fees for using intellectual property.

If closing down the London office was all it took to avoid the tax, then surely they would. But that'd hardly appease the Daily Mail reading British tax payers; everybody would still moan that they're "doing business in Britain", whatever that means.

The whole Bermuda thing is screwing the Irish out of their share of money made in Britain, but that's their problem.