Steve Jobs, who may have been an original gold bug and never had a license plate for his car, was a tremendous tax planner, allowing Apple to pay billions of dollars in taxes. As part of a successful job at Apple, NYT offers a feature in Apple's tax planning that includes the following:
Every second of every hour, millions of times a day, in the salons and cash registers, consumers click on the "Buy" button on iTunes or send the payment for an Apple product.
And with that, an international financial engine is set in motion, moving money across continents in the blink of an eye. While Apple's Reno office helps the company avoid government taxes, its international affiliates - in particular the sale of royalties and sales to other countries - help reduce taxes owed to US and other governments .
For example, one of Apple's subsidiaries in Luxembourg, called iTunes S.à rl, has only a few dozen employees, according to company documents filed in that country and a current executive. The only indication of the presence of the outer subsidiary is a letterbox with an unrolled sheet of paper "ITUNES SARL".
Luxembourg has only half a million inhabitants. But when customers in Europe, Africa or the Middle East - and potentially elsewhere - download a song, a television or an application, the sale is recorded in this small country, according to current and former leaders. In 2011, sales of iTunes S.à rl exceeded $ 1 billion, according to an Apple executive, who account for about 20 percent of iTunes' global sales ... Apple, former executives say, have have been especially gifted to identify legal gaps in taxes and hire accountants who, as well as iPhone designers, are known for their innovation.
In the 1980s, for example, Apple was one of the first big companies to designate overseas distributors as "commissioners" rather than retailers, said Michael Rashkin, Apple's first fiscal policy director, who helped establish the system before leaving in 1999.
For customers, the designation was virtually imperceptible. But because brokers never technically take inventory - which would force them to recognize taxes - the structure allowed a high tax seller in Germany, for example, to sell computers on behalf of a Singapore subsidiary with low tax rates. Therefore, most of these benefits would be taxed in Singapore instead of the German rates ...
In the late 1980s, Apple was one of the pioneers in creating a tax structure - called Double Irish - that allowed the company to transfer its profits to tax havens around the world, said Tim Jenkins, who helped establish the system as European Director of Finance until 1994.
Apple has created two Irish subsidiaries - today called Apple Operations International and Apple Sales International - and has built a glass factory in the green fields of Cork. The Irish government offered tax relief to Apple in exchange for jobs, according to former leaders with a knowledge of the relationship.
But the biggest advantage was that the agreement allowed Apple to send royalties on patents developed in California in Ireland. The transfer was internal and simply transferred funds from one part of the company to a foreign affiliate. But as a result, some profits were taxed at the Irish rate of around 12.5 percent, rather than the statutory rate of the US. of 35 percent. In 2004, Ireland, a nation of less than 5 million, was home to more than a third of Apple's overall revenue, according to company deposits ...
In addition, the second Irish subsidiary - the "Double" - has allowed other benefits to face tax-free businesses in the Caribbean. Apple has granted partial ownership of its Irish affiliates to Baldwin Holdings Unlimited in the British Virgin Islands, a tax haven, according to documents filed here and in Ireland.
Every second of every hour, millions of times a day, in the salons and cash registers, consumers click on the "Buy" button on iTunes or send the payment for an Apple product.
And with that, an international financial engine is set in motion, moving money across continents in the blink of an eye. While Apple's Reno office helps the company avoid government taxes, its international affiliates - in particular the sale of royalties and sales to other countries - help reduce taxes owed to US and other governments .
For example, one of Apple's subsidiaries in Luxembourg, called iTunes S.à rl, has only a few dozen employees, according to company documents filed in that country and a current executive. The only indication of the presence of the outer subsidiary is a letterbox with an unrolled sheet of paper "ITUNES SARL".
Luxembourg has only half a million inhabitants. But when customers in Europe, Africa or the Middle East - and potentially elsewhere - download a song, a television or an application, the sale is recorded in this small country, according to current and former leaders. In 2011, sales of iTunes S.à rl exceeded $ 1 billion, according to an Apple executive, who account for about 20 percent of iTunes' global sales ... Apple, former executives say, have have been especially gifted to identify legal gaps in taxes and hire accountants who, as well as iPhone designers, are known for their innovation.
In the 1980s, for example, Apple was one of the first big companies to designate overseas distributors as "commissioners" rather than retailers, said Michael Rashkin, Apple's first fiscal policy director, who helped establish the system before leaving in 1999.
For customers, the designation was virtually imperceptible. But because brokers never technically take inventory - which would force them to recognize taxes - the structure allowed a high tax seller in Germany, for example, to sell computers on behalf of a Singapore subsidiary with low tax rates. Therefore, most of these benefits would be taxed in Singapore instead of the German rates ...
In the late 1980s, Apple was one of the pioneers in creating a tax structure - called Double Irish - that allowed the company to transfer its profits to tax havens around the world, said Tim Jenkins, who helped establish the system as European Director of Finance until 1994.
Apple has created two Irish subsidiaries - today called Apple Operations International and Apple Sales International - and has built a glass factory in the green fields of Cork. The Irish government offered tax relief to Apple in exchange for jobs, according to former leaders with a knowledge of the relationship.
But the biggest advantage was that the agreement allowed Apple to send royalties on patents developed in California in Ireland. The transfer was internal and simply transferred funds from one part of the company to a foreign affiliate. But as a result, some profits were taxed at the Irish rate of around 12.5 percent, rather than the statutory rate of the US. of 35 percent. In 2004, Ireland, a nation of less than 5 million, was home to more than a third of Apple's overall revenue, according to company deposits ...
In addition, the second Irish subsidiary - the "Double" - has allowed other benefits to face tax-free businesses in the Caribbean. Apple has granted partial ownership of its Irish affiliates to Baldwin Holdings Unlimited in the British Virgin Islands, a tax haven, according to documents filed here and in Ireland.
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