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Virgincare Pays No Taxes Whilst Profiting From The NHS

The NHS Support Foundation has researched the private healthcare providers contracted to the NHS, and their tax evation methods used to maximise their profit from NHS patients and the provision of services for the NHS.

Pic: Branson the surgeonSince 2010 when Virgin Care was formed the company has not reported a profit but a loss of around £9 to £10 million each financial year. No profit means no tax is paid in the UK. However, Virgin Care’s position within the complex structure of Richard Branson’s empire has raised some questions about tax liabilities.

In March 2015, an investigation by Richard Murphy,a chartered accountant at Tax Research UK, highlighted the use of tax havens by Virgin Care and other private companies working with the NHS. The investigation found 13 holding companies, some of them offshore, between Virgin Care and its ultimate parent company, based in the British Virgin Islands, a tax haven.

Murphy’s research also found that Virgin Care borrows money solely from a Virgin holding company and reports that it will repay that loan, which will be corporation tax-deductible, when a profit starts to be recorded. That holding company is based in the UK but it, in turn, owes money to other parts of the Virgin business, whose ultimate parent company is in the British Virgin Islands.

This type of corporate set-up has potential for reducing or eliminating the tax liabilities of operating companies; a company in the UK could always report a loss due to loan repayments to sister companies thereby never having to pay tax.  

You can read the full article here: http://www.nhsforsale.info/private-providers/virgin.html

Source: NHS Support Foundation

 


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