It would seem that HMRC are making progress in their efforts to make larger concerns more responsible when paying tax.
Google have been criticised in the past for using complex arrangements to reduce their UK tax liabilities. Google have responded that they have only taken advantage of tax strategies that are legal – in effect Google are saying that if the law has created scenarios that were not intended by Parliament, then the law should be changed.
Recent press commentary has speculated that Google is about to be hit by a £24m tax demand. Apparently, Google’s UK staff in London are given shares by the US parent company as part of their remuneration package. In the past these share issues have been used to reduce Google’s UK tax bill.
HMRC, it would appear, are on the case. They seem to be clamping down on aggressive share schemes. Google have released the following comment:
“This is a matter the company is discussing with HMRC in an ongoing review initiated in 2010. The company has made a provision of £24 million for potential corporation tax for the years under review (2005-11).”