How Hp Tried To Dodge Paying Millions in UK Taxes

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Date: Thursday July 24, 2014 01:22:13 pm
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    How Hp Tried To Dodge Paying Millions in UK Taxes
    Hewlett Packard tried to dodge paying millions in UK tax by using a network of European holding companies – but insists it did not break any laws

    By Peter Campbell

    The scheme was unwound late in 2012 when HP took a £5billion writedown on the company that it paid £7.1billion for in 2011.

    But accounts filed last week show for the first time the structure that HP used when making the acquisition – which accountants who studied them said were intended to provide it with years of tax deductible interest payments, potentially saving it tens of millions of pounds in tax.

    http://www.rawstory.com/rs/wp-content/uploads/2011/02/uncut1.jpg

    When HP snapped up the software giant, it created Hewlett-Packard Vision Limited, which is registered in the UK but is owned out of Luxembourg, to handle the deal.

    Accounts showed that, in January 2012, this entity borrowed £4.5billion from an HP financing company based in Belgium.

    The loan, at a rate of 2.0336 per cent interest, would yield the Belgian lender £91million a year in tax deductible interest payments annually.

    Between January and October HP Vision Limited claimed more than £10million in tax relief from the payments.

    Once the company took the writedown in October that year, HP repaid the loan – but only after receiving a £4billion payment from another HP subsidiary based in Luxembourg.

    HP Vision Limited now has a smaller loan worth £142million from a different Dutch holding company, with interest of 4.5 per cent.

    HP last night said it had not broken any laws and ‘adheres to the highest ethical standards’.
    http://2.bp.blogspot.com/_a87nJg6JUnY/SoEW0YAhARI/AAAAAAAAANg/_73IIUI4E1g/s320/HP.jpg

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