Apple’s main Irish arm paid over €6.5bn in corporation tax last year

Latest accounts show pre-tax profits increased to $71bn but turnover dropped

Apple’s main Irish arm paid corporation tax totalling $7.87bn (€6.57bn) last year, well over three times more than the tech giant paid as recently as 2020.

Apple’s main Irish-registered entity reported pre-tax profits of $71bn in 2023 in financial accounts filed with the Companies Registration Office here this week.

Although the company’s filings do not break down where tax was paid, it includes, but is not limited to, corporation tax paid in Ireland where Apple is understood to be among the biggest, if not the biggest, single payer of corporation tax.

The accounts are for the California-headquartered technology giant’s Irish-registered Apple Operations International Limited, which acts as a parent company for dozens of subsidiaries outside the US.

Pre-tax profit was up from $69.3bn in 2022.

The Irish arm’s turnover last year was $218.89bn, down slightly from 2022 but making up more than half of the organisation’s total sales, including in the US market.

The dividend paid by the Irish headquartered arm jumped dramatically, to just over $92bn in 2023 from $20bn a year earlier. Dividends paid to the group’s US parent are liable to taxation in the US.

Meanwhile, net tax paid by the Irish entity rose again in 2023, although at a much slower pace than the preceding number of years.

The accounts show the business here paid $7.87bn in tax.

It was up from $7.69bn in 2022, $4.44bn paid out by the same business in 2021 and $2.38bn in 2020.

The total of corporation tax collected by the Irish government last year was €23.8bn, itself a massive increase on levels paid a decade ago.

A report earlier this week from the Parliamentary Budgetary Office at the Houses of the Oireachtas found the corporation tax take increased 23pc on average each year between 2014 and 2022, before it stabilised last year.

The rise in the amount of tax paid by Apple Operations International Limited is therefore in line with the Irish Government’s corporation tax trend.

Corporation tax surged as adjustments to global tax rules kicked off massive changes in many multinationals’ corporate structures and intra-company management of profits and tax, but with still highly unpredictable longer-term consequences.

In Apple’s case, the tech giant appears to have exhausted so-called deferred tax assets that helped substantially keep a cap on its overall tax bills in recent years.

The latest Apple Operations International Limited accounts don’t show any remaining intra group deferred tax assets.

It had already decreased to $812m by September 2022, the end of its tax year, from $4bn a year earlier and $7bn a year before that.

It is understood these intra group deferred tax assets included Irish capital allowances, which provide businesses with tax breaks based on investments including their purchase of intellectual property from elsewhere in a corporate group – such as an Irish unit buying intellectual property from a sister company in another tax jurisdiction.

As recently as 2016, the Apple unit’s intra group deferred tax assets were as large as $22.5bn, according to previous analysis by UCC economist Seamus Coffey, an expert in Ireland’s corporate tax regime.

Apple is thought to be among a number of large multinationals that “on-shored” intellectual property to Ireland following the global tax reforms in 2015.

These reforms limited the benefits of holding assets elsewhere and so ended schemes like the so-called “Double Irish” that had helped businesses radically limit tax bills.

‘In Ireland, Apple is understood to be among the biggest, if not the biggest, single payer of corporation tax’