back to article Google UK doubles London Kings X mega-office sprawl

Google's Blighty-based empire is set to expand, with the company renting double its current amount of office space in King's Cross, central London. In early 2014 Google agreed to take 45 per cent of the 365,000 sq ft office space at 6 Pancras Square. It now plans to fill out the whole building. The company's current UK …

  1. Anonymous Coward
    Anonymous Coward

    (cough) Tax (cough)

    "UK headcount is nearly 2,000 "

    I didn't think Google did any 'business' in the UK

    1. Steve Davies 3 Silver badge

      Re: (cough) Tax (cough)

      I wonder how this change is where VAT is levied will pan out for the Chocolate Factory.

      Now they'd have to charge UK VAT on those contracts the excuse that all the biz is done in the Emerald Isle starts to look a bit thin.

      1. Dan 55 Silver badge
        Trollface

        Re: (cough) Tax (cough)

        I've heard they use SEPA and pay their salaries to an Irish bank.

        1. ratfox

          Re: (cough) Tax (cough)

          The Irish VAT is higher than the UK VAT (and most other countries), so Google should be happy about the change. The change should have no implication whatsoever on where the income is, though. It's not because the VAT is now charged in the country of the buyer that the seller is going to suddenly change countries…

    2. JDX Gold badge

      Re: (cough) Tax (cough)

      You pay tax on profit. Paying 2000 salaries costs quite a lot :)

    3. Khaptain Silver badge

      Re: (cough) Tax (cough)

      Of course they do business but unfortunately they didn't make any 'UK taxable' profit from the $6 Billion in British revenue! Shucks...

      Quick pass me another bottle of that Codeine cough syrup....

  2. choleric
    WTF?

    Playmobil

    Ahh! It's back! But I am a little confused: with the header image I thought the headline would be

    "Googleplex in SPAAAAAAAAAAACE!!"

    1. Alister

      Re: Playmobil

      And they forgot the lens flare!!!

  3. Boris the Cockroach Silver badge
    Flame

    Employing

    2000 people here and never once makes a profit?

    Ermmmm to give an example the steel makers only have to make a slight loss and the workforce gets slashed, google never makes a profit here, yet hires loads more people... something stinks

    1. Anonymous Coward
      Anonymous Coward

      (sigh)

      Once more… Google UK does not sell anything. Anything that Google sells in UK is sold by Google Ireland, which pays income tax in Ireland, and not UK.

      Irish companies are allowed to sell in the whole of Europe, and there is no requirement to use the local UK company whenever you happen to also have one.

      The way Google UK makes money is by offering a (technically third-party) sales service to Google Ireland. Google Ireland pays Google UK for this sales service, allowing it to make a little bit of profit, although far less than Google Ireland; the same as when you buy a plane ticket from a travel agency, the airline company gets more of your money than the travel agency.

      There is a way to fix this, which is to add a new law, stating that it is fine for any company to sell everywhere in Europe, yes, but that when you also control a company in the country of the buyer, then that is the company that should be doing the selling.

      The problem is that this law must be accepted by Europe; and Europe is controlled by a couple of powerful countries with a lot of companies that sell in other countries. Those powerful countries might lose with the change, so it will be tough convincing them.

      1. Anonymous Coward
        Anonymous Coward

        Re: (sigh)

        Your solution doesn't solve anything.

        It would be much simpler to harmonize tax rates in the EU.

        It is not where the sale is clocked, but where is the profit booked (transfer pricing etc) this is not at all simple.

        My current employer has R&D in several countries, software development in others, management in another, managed services in another, hardware production in, well, China.

        If we sell $1000 in my country (none of the above), sure you can book the sale here - but the R&D and manufacture and software support has to be paid (transfer pricing) that costs pretty much whatever the top management says it does, not to mention the cost of employing us local guys.

        When I worked for an earlier UK-based employer (small firm ~200 people all in UK) I was their remote sales office - but orders and invoices and everything went back to UK, I was merely an expense we paid no local tax (I did on my salary). That is the way it works, that is normal. Everybody is just jealous that Google isn't from their home country and they aren't big enough to setup in Ireland.

        As for Google - well, politicians seem to forget that they wrote the rules. If they want to change them then go right ahead. Then we can watch as huge profitable British (and Eurpoean) firms get slaughtered abroad as every country does the same money grab on revenue.

        1. JDX Gold badge

          Re: (sigh)

          So you want to the EU to dictate tax rates to member states?

      2. Anonymous Coward
        Anonymous Coward

        Re: (sigh)

        There is a way to fix this, which is to add a new law, stating that it is fine for any company to sell everywhere in Europe, yes, but that when you also control a company in the country of the buyer, then that is the company that should be doing the selling.

        This only works if identical products are being sold in each country. Suppose I have a company that makes bicycles in the UK and sells them to the UK and Europe; and I also have a factory in France that makes tricycles, selling to France and the rest of Europe. How do you expect me to account to HMRC for tricycles sold in the UK under this law that you are proposing? Would I have to ship the tricycles to the UK factory and then ship them on to UK customers? What if I don't have any space in the UK factory to do this? If I rent some more factory space to enable this, should it be the French company or the UK company that does the renting? The problems are just endless.

    2. Boris the Cockroach Silver badge
      Flame

      Re: Employing

      You're all going up the wrong tree here

      Google SELLS advertising to British companies via their north London HQ

      Google then make a profit on those sales that the price charged minus the wage and infrastructure costs

      By swapping the profit out to Ireland, they pay no tax on that profit for business done in the UK by UK companies trying to sell to UK customers.

      That is what is wrong, you can complain that they pay income tax, building rates, power charges, VAT etc.. but these are all known costs of doing business here and included in the costs.

      They make use of all the taxpayer provided stuff such as roads, sewerage, fire brigade, police, NHS, etc etc WITHOUT PAYING ANYTHING FOR THEM.

      If they want to do business in the UK and earn a profit from doing so, then they pay tax on their UK profit to the Inland revenue.

      I have to pay my tax, the company I work for (being a UK company) has to pay its tax, why should google UK be any different?

      1. Anonymous Coward
        Anonymous Coward

        @Boris

        You haven't read properly. Google Ireland does not use any taxpayer provided stuff in UK. It makes boatloads of money by selling advertising to British companies, but it's an Irish company, so it does not use UK infrastructure, and it does not need to pay taxes in UK.

        Google UK does not sell advertising to British companies. Google UK does pay for taxpayer provided stuff. It reports its income, and pays tax on it. And all its UK employees also pay income tax, just like you do.

        Your company pays income tax in the UK, and probably only in the UK. It might sell something to a French company, or a German company, or an Italian company, but it almost certainly does not pay income tax in France, Germany, or Italy.

        The only difference is that your UK company probably does not have a sister company in France, while Google Ireland happens to have a sister company in UK. Legally, this does not change anything. Maybe it should, as proposed above. But it does not.

  4. Stuart 22

    Can I help?

    Hi Google,

    You need more office space?

    Have you not approached the awfully nice people who live in a green officeblock just north of Vauxhall Cross with a lovely view of the Thames? They are in the same line of business and have perabytes of links already fitted. It would be a truly hat, glove and dark glasses fit if you moved in alongside.

    Their masters might forgo all this silly talk of taxes and might be good for the odd gong if you routed your data through them without all this weird creepo stuff.

    Best Wishes,

    Felix

    1. Anonymous Coward
      Anonymous Coward

      Re: Can I help?

      Oh, I'm sure that the London Underground tunnels can handle another cable trunk. It's not a real problem, also because there's enough subterranean work happening to quietly add a few things without anyone noticing.

      No worries, they probably have the data connection covered. As for locating them near the other two fun places, it's worth keeping in mind that separate buildings represent a degree of plausible deniability.

  5. Chris G

    It looks as though Borgle has either decided to bite the tax bullet when and if the UK Gov figures out how to make them pay or, they have discovered a long term cast iron tax dodge.

    Of course they won't mind paying VAT since that is not their money anyway, they will only be collecting it from the client and passing it on, although a 20% hike in their prices may hit them a little hard.

    1. Anonymous Coward
      Anonymous Coward

      No 20% hike

      Once they have to charge the 20% UK VAT, they will not have to charge the Irish 23% VAT any more. So their prices will go down.

      1. Roj Blake Silver badge

        Re: No 20% hike

        Unless the Tories win in May, in which case the UK VAT rate will be a lot closer to the Irish one.

    2. Badvok
      WTF?

      "It looks as though Borgle ..." - Who's Borgle? You must have some really weird keyboard layout to get that as a typo.

  6. Haro

    Room for the Spanish people

    All you people who want to tax them to death -- Remember Spain!

    1. FlatSpot
      Megaphone

      Re: Room for the Spanish people

      What of Spain?

      Ok so a quick look at the fountain of knowledge wikipedia

      Debt % of GDP - Spain 85.3%

      Debt % of GDP - Uk 90.0%

      That's from 2012, so since then the UK coalition have been borrowing tremendous amounts of money, to prop up low wages and pretend the boom times are back.

      Then if we google "director earnings to staff" we find great headlines such as;

      8,000 NHS staff on six figure salaries

      30 charity bosses paid more than £100,000

      Save The Children bosses get £160,000 in bonuses

      So about that 0.1% thing.... if we tax google out the country that would be a good thing. Instead of the google of things, we would have hundreds of smaller companies being able to make a living and paying taxes and innovating, whereas they can't as they are pushed out of the market by google and it's non-taxed muscle giving everything away for free.

      Maybe I'm just getting old...

  7. ukgnome

    correlation

    sq units taken goes up, taxation goes down.

  8. Smoking Gun

    Haven't the EU recently ruled the similar deal that Amazon have with Luxembourg is illegal?

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