Apple says EC investigation could result in 10 years of back taxes in Ireland

in General Discussion edited April 2015
In a filing with the U.S. Securities and Exchange Commission on Tuesday, Apple warned that a European Commission investigation could require the company to pay ten years' worth of back taxes to Ireland.

Apple's headquarters in Cork, Ireland, via Flickr user Sigalakos.

According to its 10-Q regulatory filing, Apple may be forced to pay ten years of back taxes if an investigation opened by the European Union's antitrust watchdog finds Ireland's tax agreements with Apple constitutes state aid. Apple acknowledged that such an amount "could be material," but the company was unable to estimate what impact it would have to its bottom line.

The information was first reported by The Wall Street Journal.

In June 2014, the European Commission launched a formal investigation into Apple's tax practices in Ireland. Apple, like other large multinational corporations, operates Irish subsidiaries in a strategy called the "Double Irish with a Dutch Sandwich." The process, which is legal, skips international revenue through subsidiaries registered in low tax rate countries like Ireland and the Netherlands, then off to a no-tax country like the Caribbean.

A preliminary EC report last September found tax deals between Ireland and Apple subsidiaries Apple Operations International, Apple Sales International and Apple Operations Europe amount to illegal state aid.

In its regulatory filing this week, Apple said the EC's assertions are "without merit."
Sign In or Register to comment.