Barclays has voluntarily disclosed that its UK corporation tax liability for 2011 was approximately £300m.
Barclays has voluntarily disclosed that its UK corporation tax liability for 2011 was approximately £300m.
The bank said in its ‘citizenship report’ that it recognised the need to reflect a ‘changing approach’ to the taxation of corporates in the way it managed its future tax affairs. ‘The UK taxes borne in 2011 included corporation tax of £0.3bn plus bank levy of £0.2bn paid to HMRC,’ it said.
Barclays noted that ‘many commentators’ sought to compare the taxes paid in a year in a specific country to the profit generated in that country, to test whether the tax paid was ‘fair’. This was not a straightforward exercise for timing-related reasons, it said.
Barclays also pointed out that the UK corporation tax figure could not be compared against its overall, global profit before tax in 2011, because ‘a significant portion of that profit was earned via operations outside of the UK and is generally, therefore, not subject to tax in the UK’.
But there was a ‘material interest’ in comparing the UK corporate tax to a relevant profit figure for 2011, it said. The ‘profit before tax in the UK after taking account of brought forward losses’ was approximately £1bn. The figures exclude any additional tax payable as a result of the retrospective change in the law announced on 27 February.
Barclays said it was ‘simply not the case’ that its operations in ‘offshore finance centres’ were used for the purposes of tax avoidance. ‘Virtually all’ of the profits generated in its 134 Cayman Islands companies were subject to corporate tax at the UK rate.
A business leader in The Observer noted that the group was pledging to reduce in 2012 the number of ‘Cayman offshoots’, but added: ‘The opaque language [used in the report] means that, yet again, Barclays is raising more questions than it has answered.’
Barclays has voluntarily disclosed that its UK corporation tax liability for 2011 was approximately £300m.
Barclays has voluntarily disclosed that its UK corporation tax liability for 2011 was approximately £300m.
The bank said in its ‘citizenship report’ that it recognised the need to reflect a ‘changing approach’ to the taxation of corporates in the way it managed its future tax affairs. ‘The UK taxes borne in 2011 included corporation tax of £0.3bn plus bank levy of £0.2bn paid to HMRC,’ it said.
Barclays noted that ‘many commentators’ sought to compare the taxes paid in a year in a specific country to the profit generated in that country, to test whether the tax paid was ‘fair’. This was not a straightforward exercise for timing-related reasons, it said.
Barclays also pointed out that the UK corporation tax figure could not be compared against its overall, global profit before tax in 2011, because ‘a significant portion of that profit was earned via operations outside of the UK and is generally, therefore, not subject to tax in the UK’.
But there was a ‘material interest’ in comparing the UK corporate tax to a relevant profit figure for 2011, it said. The ‘profit before tax in the UK after taking account of brought forward losses’ was approximately £1bn. The figures exclude any additional tax payable as a result of the retrospective change in the law announced on 27 February.
Barclays said it was ‘simply not the case’ that its operations in ‘offshore finance centres’ were used for the purposes of tax avoidance. ‘Virtually all’ of the profits generated in its 134 Cayman Islands companies were subject to corporate tax at the UK rate.
A business leader in The Observer noted that the group was pledging to reduce in 2012 the number of ‘Cayman offshoots’, but added: ‘The opaque language [used in the report] means that, yet again, Barclays is raising more questions than it has answered.’
