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US streaming service questioned by HMRC

Netflix has become the latest US company to be questioned by the UK regarding its tax procedures, after it was revealed that the streaming service had failed to

pay any corporation tax in 2014.

With 4.5m UK subscribers and £200m in revenue, the company responsible for highly-rated shows such as House of Cards, Orange is the New Black, and Narcos charges £5.99+ per month and has enjoyed rapid growth since it launched in 2012.

However, a Sunday Times evaluation showed that the fees paid by customers in the UK are collected by Netflix Int. BV, which was based in Luxembourg until 2015.

It has been said that, in spite of the UK being Netflix’s biggest European market, the firm is making income tax payments in Luxembourg as opposed to the UK. Netflix Services UK, the account’s British subsidiary, received around £35,000 in income tax credit.

The company said that it remains in expansion mode, still making a loss overall on worldwide growth. A Netflix spokesman told the Sunday Times that the firm’s British subsidiary hires 12 staff and this year will be paying corporation tax.

The spokesman added:

“We are fully compliant with all applicable rules.”

Tax can be a complex beast, which is why it is always wise for a business to hire the best accountant that they can afford. There are a number of accountants in the Wirral who are more than up to the task of keeping small to medium enterprises on track.

Posted by Louise
January 4, 2016

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