Monday, November 29, 2021

Google’s footprint in Ireland since 2003

Google set up its EMEA headquarters in Dublin in 2003, a year before its IPO.  Initially it was a modest operation and during 2003 the average headcount was 21. By the 2020 annual report of Google Ireland Limited this had increased to 4,314.

Google Ireland Limited Headcount 2003-2020

The accounts also give the staff costs incurred.  These have increased from €0.7 million to just over €750 million in 2020.  All told, Google Ireland Limited has had €4.8 billion of staff costs since it was established in 2003, with almost three-quarters of that being wages and salaries.  For its most recent year, 2020, the average of wages and salaries per person employed was €120,000

Google Ireland Limited Staff Costs 2003-2020

The column for “social welfare” is almost certainly employer’s PRSI and the company has paid €360 million of this over the past 18 years.  The company has also made €121 million of payments into its defined contribution pension plan where “the company matches the employee’s contributions up to a maximum a seven per cent.”

We now turn briefly to the financial outturns for Google Ireland Limited with the numbers and the table getting a bit bigger.  Click to enlarge.

Google Ireland Limited Income Statements 2003-2020

Turnover has grown from just €7.5 million in 2003 to €48.4 billion in 2020.  In cumulative terms, the company has had more the €300 billion of turnover but more than half of that was in the last four years.

The company has had a cumulative pre-tax profit of €10.2 billion and incurred a tax charge of €1.7 billion.  Of this €0.1 billion was for foreign withholding taxes leaving a charge to Irish Corporation Tax of €1.6 billion.  That gives a charge to Irish tax of 15.8 per cent of profit before tax.  This is higher than the standard 12.5 per cent that applied during the period for two reasons.

First, the company incurred expenditure that was not allowable as a deduction for tax purposes meaning its taxable income was larger than the profit reported in the accounts. Second, the company had some non-operating income, such as income received, and this is taxed at the 25 per cent of Corporation Tax for non-trading income.

There does appear to be a couple of noticeable step-changes in the accounts for Google Ireland Limited, most noticeably for operating profit.  Could these be linked to the recent tax settlement that was revealed last week.  Perhaps.  And we will look at that in a subsequent post.

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