Feeds

Inland Revenue probes IBM for tax avoidance

Ex-employee sparks allegations that funds were shipped to US to dodge UK tax

  • alert
  • submit to reddit

Security and trust: The backbone of doing business over the internet

IBM UK has confirmed it is in talks with the Inland Revenue concerning allegations of tax evasion. Big Blue issued a short statement today following a story in the Wall Street Journal (WSJ) which alleges that IBM could owe government coffers more than £300 million in unpaid taxes. The allegations centre on whistle-blowing ex-employee Gerard M Churchhouse who was sacked by IBM in 1995. It is not known why the sales and marketing manager was dismissed. However, it seems in return for being booted out he squealed to the Inland Revenue alleging that IBM UK had upped its royalty fees to the IBM Corporation. Instead of paying eight per cent of its income derived from the sale of products and services to IBM Corp, IBM UK increased the payments to 12 per cent. The net result, Churchhouse alleged, was that IBM UK paid less tax in the UK -- because its income was effectively cut -- at a time when IBM Corp was paying little or no tax in the US due to its poor performance. The alleged tax dodging was said to have taken place between 1991 and 1996. Reading from a prepared statement, an IBM representative said: "IBM is currently working with the Inland Revenue on an enquiry. "This is a normal and routine procedure and IBM is co-operating fully. "IBM has no comment to make about Mr Churchhouse or his allegations." The WSJ claims that IBM UK has been under investigation for the last two years. But a spokeswoman for the Inland Revenue said she was unable to comment one way or other on the case. ®

New hybrid storage solutions

More from The Register

next story
JINGS! Microsoft Bing called Scots indyref RIGHT!
Redmond sporran metrics get one in the ten ring
Phones 4u slips into administration after EE cuts ties with Brit mobe retailer
More than 5,500 jobs could be axed if rescue mission fails
Phones 4u website DIES as wounded mobe retailer struggles to stay above water
Founder blames 'ruthless network partners' for implosion
Found inside ISIS terror chap's laptop: CELINE DION tunes
REPORT: Stash of terrorist material found in Syria Dell box
OECD lashes out at tax avoiding globocorps' location-flipping antics
You hear that, Amazon, Google, Microsoft et al?
Show us your Five-Eyes SECRETS says Privacy International
Refusal to disclose GCHQ canteen menus and prices triggers Euro Human Rights Court action
prev story

Whitepapers

Providing a secure and efficient Helpdesk
A single remote control platform for user support is be key to providing an efficient helpdesk. Retain full control over the way in which screen and keystroke data is transmitted.
WIN a very cool portable ZX Spectrum
Win a one-off portable Spectrum built by legendary hardware hacker Ben Heck
Storage capacity and performance optimization at Mizuno USA
Mizuno USA turn to Tegile storage technology to solve both their SAN and backup issues.
High Performance for All
While HPC is not new, it has traditionally been seen as a specialist area – is it now geared up to meet more mainstream requirements?
Security and trust: The backbone of doing business over the internet
Explores the current state of website security and the contributions Symantec is making to help organizations protect critical data and build trust with customers.