Net-a-Porter accused of tax dodge by Channel 4
Britain's Channel 4 TV aired a program this week, criticising the way the Net-a-Porter Group pays its taxes. The British fashion company gained sales of £435million in the tax year to March 2013, but posted a loss of £24.7million, according to Channel 4 news.
The new report claimed that Net-A-Porter used clever planning to pay a fraction of the tax you would expect it to, by turning its profits into a loss. It was also claimed that the loss was created in a way to reward its senior executives through shares.
Richard Murphy, of Tax Research UK, said, "In this particular company's case, we don't know where it's making its profits, we don't know where it's paying it's tax."
However, the scheme allegedly used by the online fashion shop is perfectly legal, but will have UK taxpayers wagging their fingers at the retail company.
Net-A-Porter stated its accounts "fully reflect the company’s business within the UK" in light of the recent accusations.
Update: Net-a-porter gave Buro 24/7 the following statement –
"The NET-A-PORTER Group Limited accounts fully reflect the company's business within the UK. The NET-A-PORTER Group is fully liable for UK Corporation Tax on the results of these UK operations. The NET-A-PORTER Group Limited is not a publicly listed company and its parent, Richemont, does not comment on the financial performance of individual businesses within the Group.
"The NET-A-PORTER Group Limited is a business with a global reach and operations in the UK, the USA and Hong Kong. The NET-A-PORTER Group Limited employs over 1,500 people in the UK, its largest geographical concentration of personnel."