Alphabet, Google’s parent company, will report its 2015 earnings next week and is expected to confirm that offshore cash funds have grown by about $4bn in just 12 months.
Offshore reserves of $43bn, held largely through Bermuda, represent profits from markets outside the US. Of these markets, the UK is the largest, accounting for 17% of non-US sales. But latest published accounts show Google’s UK subsidiary paid just £21m in tax for 2013.
Google’s tax structure means income from many major overseas markets – including £4.56bn from the UK – is booked through Ireland. Much of it is then bounced through the Netherlands and back to Ireland and Bermuda. These strategies are known in tax jargon as the “Double Irish” and the “Dutch Sandwich”.Tax strategies have nicknames?