Facebook uses Ireland to shrink tax bill

Facebook’s Irish subsidiary paid just £2.5m in corporation tax in 2014, despite handling £3.4bn of the technology giant’s global turnover.

The amount was paid in Irish corporation tax from its base in Dublin, which manages the sale of digital adverts to more than 80% of its 1.5bn users.

Almost half of Facebook’s revenues are channelled through Ireland, yet Facebook Ireland produced a pre-tax profit of just £9.2m.

According to The Times, the social network reduces the profitability of the Dublin subsidiary by paying huge licensing fees to other companies in the group for the “use of the Facebook platform”.