Facebook, which used to pay just a few thousand pounds in tax in Britain, has been forced to cough up millions of pounds more after the social networking giant agreed to stop routing its UK sales through Ireland that allowed it to keep its tax bill extremely low.
From April this year, the Silicon Valley headquartered firm will restructure its tax policy so that revenue generated from its largest advertisers displaying content on Facebook will be routed through the UK rather than Ireland. The change, which will generate higher taxable profits in Britain, follows accusations that the US firm was paying far too little tax in the country. Facebook paid just 4,327 pounds ($6,116) in corporation tax in 2014 in Britain. “On Monday we will start notifying large UK customers that from the start of April they will receive invoices from Facebook UK and not Facebook Ireland,” Facebook said in an internal post seen by the BBC.