Google Are Paying Their Back Taxes in the UK

It looks like Google has a lot of catching up to do as far as taxes are concerned, particularly in the United Kingdom. Following an open audit of its accounts conducted by a team of investigators, the company has agreed to pay £130 million in back taxes. What’s interesting is the fact that some of the taxes in question date all the way back to 2005, and this kind of makes sense considering how often Google has come under fire for not paying its share. Apparently, the deal with Her Majesty’s Revenue and Customs will also ensure that the company will pay the correct amount of taxes in the future. One of Google’s representatives has stated the following:

“We have agreed with HMRC a new approach for our UK taxes and will pay £130 million, covering taxes since 2005. We will now pay tax based on revenue from UK-based advertisers, which reflects the size and scope of our UK business. The way multinational companies are taxed has been debated for many years and the international tax system is changing as a result. This settlement reflects that shift and is in line with recent OECD guidance.”

In the past, the company has been known to take “shortcuts” when it comes to paying its taxes to foreign countries. The tactics that were employed were definitely not illegal, but they were somewhat immoral, at least according to MP Margaret Hodge. We’re talking about the year 2012, in which Google has reportedly used subsidiaries in Bermuda and Ireland in order to dodge a £1.2billion tax payment. Hopefully, this new deal will pave the way for a better relationship between Google and the UK’s officials.