Netflix paid £3.2 million in UK corporation tax in 2019, a record for the streamer despite estimated revenues of £940 million in the country.
Between them, Netflix Services UK, Netflix Studios UK, and Netflix Productions UK reported revenues of £120 million in the fourth quarter and pre-tax profits of £13 million.
Netflix UK operations have benefitted from Britain’s lockdown restrictions, with the BARB Establishment Survey reporting the streaming service to have 14.8 million UK subscribers by the end of September 2020.
As is common with many pay-TV providers, subscriptions are paid to a separate company based in the Netherlands. The practice is also common among the big digital beasts such as Apple and Google.
However, the streaming service, which has produced a string of UK hits including The Crown, Bridgerton and Sex Education, says it pays tax on profits not revenues and for the past five years 50% of this has gone into new content.
A spokesperson for Netflix told Broadband TV News: “We are proud to be increasing our investment in the UK’s creative industries – spending over $1billion in the UK on new, locally-made films, series and documentaries in 2020 alone, helping to create thousands of jobs and showcasing British storytelling and culture to the world. We pay all taxes required and are committed to playing an active role in supporting British production and creative talent for the long term.”
Netflix says in the future its tax structure will reflect the way the business is evolving.
