Following a review from HM Revenue and Customs (HMRC), eBay’s UK subsidiary has agreed to pay an extra £7 million in tax.
Latest figures from the auction site revealed that the firm’s sales in 2017 rose to more than £500 million; however, its profits were still quite small at £20 million.
The additional payment of £7 million covers tax liabilities from previous financial years. Its tax bill for 2017 came to another £6 million.
Moreover, eBay only paid £1.6 million in corporation tax on declared profits of £7.7 million, in 2016.
The multinational company stated that they comply with all relevant laws and rules of every country it works in, including the UK.
An HMRC spokesperson said: “HMRC has a very strong track record on challenging contrived tax arrangements. We make sure that large businesses, just like everyone else, pay all the taxes due under UK law and we don’t settle for less.”
After recent public concerns in the UK that companies are not paying their fair share, eBay is one of the first online firms to agree to the settlement to pay more tax.
It is frequently criticised that large technology companies book their profits in other countries, which results in businesses paying modest amounts of tax in the UK.