Thursday, October 23, 2014

Tax-free Facebook

Facebook paid no UK corporation tax for the second year in a row in 2013, while employees received shares in the company worth tens of millions of pounds. Facebook UK incurred a corporation tax charge of just £3,169, and received a credit of £182,000.

The world’s largest social media company reported a pre-tax loss of £11.6m in the UK last year, despite its US parent company reporting a net profit of $1.5bn (£900m).

UK revenues rose from £34.6m to £49.8m. The company made £371m in advertising revenue last year, a 67% year-on-year rise from the £222m in 2012.

The company employed an average of 172 UK staff, who were paid £40.8m last year, almost double the 2012 figure of £21m. This is because of a £15.5m payment cost for “share-based payments”. UK staff received 1.52m free Facebook shares worth $118m at their current share price of about $78. There were also 2.2m shares worth more than $170m “outstanding” as at 31 December.

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