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Report: Google moves tax status of holding company from Bermuda

Simplifying structure: Google came under criticism for its tax arrangements, and sending billions of dollars of revenue to companies in Bermuda. It has now been reported that a holding company that was a tax resident of Bermuda is now a tax resident in Ireland (File photograph)

Google has moved Google Ireland Holdings Unlimited Company’s tax residency from Bermuda to Ireland, according to a report.

It has also stopped licensing its intellectual property from Bermuda, and now does so from the US, as it indicated it would in 2019 to simplify its corporate structure.

The changes are mentioned in The Irish Times, which reported that the tech giant used a controversial tax arrangement known as the "Double Irish" to shift more that $75.4 billion out of Ireland in 2019.

That tax arrangement was abolished for new companies in 2015, but was allowed for those already using it until the end of last year, when it was phased out.

Google has previously been criticised in the past for tax arrangements that allowed it to reduce its foreign tax bill.

In 2016, a number of newspapers in Britain put Bermuda under the spotlight regarding the billions of dollars sent to the island by Google. At the time, the company licensed its IP from Bermuda.

The Sun on Sunday highlighted how Google directed billions of dollars of profits a year to the island, and noted the company’s only physical presence in Bermuda was a post office box, numbered 666, located at the General Post Office in Hamilton. The newspaper explained how Google Bermuda Unlimited and Google Ireland Holdings were registered at the address of law firm Conyers Dill and Pearman, on Church Street.

In 2019, Reuters reported that a Google spokesman had confirmed it would scrap the licensing structure, saying this was in line with international rules and followed changes to US tax law in 2017.

On Saturday, The Irish Times reported Google had used the Double Irish tax arrangement in 2019. It also published a statement from Google, which said: "In December 2019, in line with the OECD’s base erosion and profit shifting conclusions and changes to US and Irish tax laws, we simplified our corporate structure and started licensing our IP from the US, not Bermuda. The accounts filed today cover the 2019 financial year, before we made those changes.

"Including all annual and one-time income taxes over the past ten years, our global effective tax rate has been over 20 per cent, with more than 80 per cent of that tax due in the US."

At the weekend, The Irish Times reported that according to the company’s accounts, Google Ireland Holdings Unlimited Company up to late 2019 was an intellectual property licensing company with no stated employees and was tax resident in Bermuda, but it became tax resident in Ireland on January 1, 2021.

The Royal Gazette has contacted Google about the reported changes to its IP licensing and to Google Ireland Holdings Unlimited Company, and is awaiting a reply.

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Published April 20, 2021 at 8:00 am (Updated April 21, 2021 at 8:42 am)

Report: Google moves tax status of holding company from Bermuda

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