Irish Google firms move cash abroad to cut tax bill

AN IRISH subsidiary of Google forwards multimillion investments to data centres in such locations as Vienna, Kuala Lumpur, Cairo…

AN IRISH subsidiary of Google forwards multimillion investments to data centres in such locations as Vienna, Kuala Lumpur, Cairo and Bermuda, according to company filings.

Raiden Ltd, with an address in Dublin, had financial assets of €415.3 million at the end of 2009, an increase from €170 million at the end of 2008. The company is owned by Google Ireland Holdings, which funds the investments in the data centres by way of share issues from Raiden.

During 2009 the company received €239.5 million by way of capital contributions from its parent, which it used to invest in its data centre subsidiaries.

The accounts list 12 subsidiaries in Europe, Malaysia, Egypt and Bermuda.

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A second Irish Google subsidiary, Aegino Ltd, saw its financial assets jump in value to €137.5 million from €103,100 during 2009.

This was because it received notice in September 2009 that Latvian subsidiary Lat-Tech DC LLC was to be voluntarily liquidated in April of this year, prompting the company to list its investment in the subsidiary as a current asset.

A dividend will be paid to the Irish firm during 2010, according to the Aegino accounts, and the amount involved is €135.7 million.

Aegino also has a 50 per cent shareholding in a data centre business in Belgium. It invested €137.5 million in the Belgian company in January 2009, according to the accounts, and got the money by way of a gift from its immediate parent, Google Ireland Holdings.

Google Ireland Holdings is owned by two Google subsidiaries in Bermuda.

There are a number of other Google subsidiaries in Ireland, including Plink Search, an unlimited company owned directly by Google International LLC, of California. The Google search engine operation in Dublin is owned by Google Ireland Ltd, the latest results for which showed turnover of €7.9 billion in 2009, and pre-tax profits of €47 million.

Its immediate parent is Doubleclick Internet Ireland Ltd, which went into voluntary liquidation in September. The firm estimated its realisable assets as $73 million (€55.8 million). Kieran Wallace of KPMG was appointed liquidator. Doubleclick is owned by Google Ireland Holdings.

Dividends from abroad are not taxed under Irish law. Google uses its Irish subsidiaries as a key part of a global tax operation that has seen it reduce its corporation tax rate on its non-US earnings to below 3 per cent.

A spokeswoman for Google said it complies fully with relevant tax legislation in the countries it operates in, including Ireland.

“That means that we contribute to all relevant local and national taxation schemes – as well as providing employment for almost 1,800 people in Ireland.”

Colm Keena

Colm Keena

Colm Keena is an Irish Times journalist. He was previously legal-affairs correspondent and public-affairs correspondent