Netflix received a €57,000 tax rebate from the UK government in 2018, despite making an estimated £700 million from UK subscribers.
A report in The Guardian states Netflix’s UK financial filing shows the company reported revenues of €48 million last year, and pre-tax profits of €2.3 million, because the hundreds of millions of pounds it makes from British subscribers’ monthly fees are funnelled through separate accounts at its European headquarters in the Netherlands.
With over 10 million Netflix UK subscribers by the end of last year – paying fees of between £5.99-£11.99 a month, with its £8.99 package by far the most popular – Netflix UK took in excess of £700 million, after sales tax, from British streamers, according to data and analytics firm Ampere Analysis.
Revenue from British subscribers increased by 40 per cent year-on-year in 2018, up from £500 million in 2017 when the company received a €199,000 tax rebate from the UK government.
Netflix’s UK subscription revenues are predicted to rise by about a third again this year to just shy of £1 billion.
Netflix reports low revenue figures in the UK because it positions the British operation as a service arm for its European headquarters where all subscriber revenues from across the continent are booked.
Netflix UK’s financial filing also revealed the company has committed millions of pounds to rental deals to secure studio space over the next 10 years. This month Netflix will takeover Shepperton Studios.