Apple Inc. (NASDAQ:AAPL), which has been accused of dodging taxes in the U.K. and other countries, apparently didn’t pay any U.K. taxes during its 2012 fiscal year, according to filings reviewed by The Financial Times and The Telegraph. In fact, the company even got a tax credit that can be used toward tax bills in future years.
How Apple Dodged Taxes In The U.K.
The FT’s Vanessa Houlder reports that Apple Inc. (NASDAQ:AAPL) used tax deductions from the shares it awarded to its employees to wipe out its tax liabilities in the U.K. for the fiscal year which ended in September 2012. In the year before that, the company’s U.K. subsidiaries paid £11.4 million in taxes.
In pre-tax profits in the U.K., the company’s main British subsidiaries posted £68 million for the fiscal year ending September 2012, according to the filings. Those subsidiaries reported £27.7 million in tax deductions in connection with its employee share award schemes. In addition, the use of those tax deductions gave Apple Inc. (NASDAQ:AAPL) an additional tax credit of £3.8 million, which can be used toward future tax bills, reports The Telegraph’s Szu Ping Chan.
There's a gold rush coming as electric vehicle manufacturers fight for market share, proclaimed David Einhorn at this year's 2021 Sohn Investment Conference. Check out our coverage of the 2021 Sohn Investment Conference here. Q1 2021 hedge fund letters, conferences and more SORRY! This content is exclusively for paying members. SIGN UP HERE If you Read More
Apple Inc. (NASDAQ:AAPL) doesn’t disclose how much of its profits were made from consumers in the U.K. because it is less than 10 percent of the company’s global sales. However, U.S. filings show $15 billion in operating profit on $36.3 billion in net sales in Europe during the 2012 fiscal year.
Apple’s Tax Practices In Focus
Filings indicate that in 2011, 84 percent of Apple Inc. (NASDAQ:AAPL)’s operating income from outside the U.S. was recorded by the company’s Irish subsidiary, and it paid a .05 percent tax rate on that income. The use of this Irish subsidiary has brought the company under fire from authorities in several countries, including the U.S.
A U.S. Senate panel launched an investigation into Apple Inc. (NASDAQ:AAPL)’s tax practices and found that the company used its international subsidiaries like the one located in Ireland to save billions of dollars in U.S. taxes. It’s been noted time and again that Apple Inc. (NASDAQ:AAPL) hasn’t broken any laws in its use of these subsidiaries, and some lawmakers are calling for the loopholes which Apple Inc. (NASDAQ:AAPL) and other major international companies use to dodge taxes to be closed.