Apple Paid Just 2% Tax On Overseas Profits
5:53pm UK, Sunday 04 November 2012
Apple paid less than 2% tax on its overseas profits, documents have revealed, after the technology giant slashed the amount foreign taxmen receive.
The iPad and iPhone creator paid $713bn (£445m) in corporation tax outside the US in the year to September 29 - despite foreign pre-tax earnings soaring more than 50% to$36.8bn (£23bn).
Papers filed with US regulators revealed Apple's overseas tax rate fell to 1.9%, compared to 2.5% the previous year amid a headline corporation tax rate in the UK of 24% and 35% in the US.
The slide in its overseas tax rate comes as the company sold 125 million iPhones, 58 million iPads and 13.5 million MacBook laptops worldwide.
Apple is the latest company to come under scrutiny for overseas tax payments after Amazon, Starbucks, Facebook and Google.
Coffee giant Starbucks reportedly paid just £8.6m in corporation tax in 14 years of trading in Britain - and nothing in the last three years.
America's top five technology companies - including Facebook, Amazon and eBay - legally avoided around £850m in corporation tax last year, according to a Sunday Times investigation.
Companies are able to sidestep the taxman by constructing complex global frameworks that allow them to move money through offshore subsidiaries and locations.
Apple channels much of its business in Britain and Europe through a subsidiary based on an industrial estate in County Cork, Ireland, The Sunday Times reported.
Ireland's corporation tax is about half the level of the UK.
Apple recorded a 45% rise in turnover to $156bn (£97bn) in the year, helping deliver a 63% rise in pre-tax profits to £34.8bn ($55.8bn).
It paid $13.3bn (£8.3bn) in federal and state taxes in the US.