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EBay pays £1.2m in UK tax on sales of £800 million

October 29, 2012 By: Dr Search Principal Consultant at the Search Clinic Category: Amazon, eBay, Ecommerce, Facebook, internet, Online Marketing, Search Clinic, Technology Companies, Uncategorized

eBay has paid just £1.2 million in tax in the UK an investigation has found.EBay pays £1.2m in UK tax on sales of £800 millionThe Sunday Times newspaper said that its tax bill in 2010 comes despite eBay’s UK subsidiaries generating sales of £800 million.

The auction site – which also owns the PayPal payments system – responded that it “complies fully with all applicable tax laws”.

The report comes after coffee giant Starbucks was also accused of paying just £8.6 million in corporation tax in the UK over 14 years.

According to the Sunday Times, eBay had sales of £789 million during 2010 in the UK at its four British subsidiaries.

Using its worldwide profit margin of 23%, it would have made a profit in the UK of £181 million, leading to corporation tax owed of £51 million. Instead, it paid just £1.2m, the report said.

Accounts for one of its units, eBay (UK) Ltd, show that for 2010 – the last year available – it owed tax of £766,000 on profits of £4.4 million.

Other large online international companies have also been accused of avoiding tax in the UK.

Facebook UK paid £238,000 in tax last year, according to its accounts. Its sales were £20.4 million.

Most of the company’s income is believed to be legally going through its European base in Dublin, where corporation tax is lower than in the UK.

And a report in the Guardian in April said that online retailer Amazon had generated sales of more than £7.6 billion in the UK over the past three years but had not paid any corporation tax on the profits from those sales.

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