Thomson and First choice operator Tui Travel did not have to pay any corporation tax within the UK last year after it was able to post record yearly profits this week. Tui Travel stated that this was a year of success for the company as it saw an eight percent jump in its pre-tax profits that added up to equal almost £390m.
The company also got to keep most of its profits due to the losses that it incurred five years ago after it had to restructure the business. As part of the deal, the company will have to begin paying taxes once the losses have carried forward and it was caught up with corporation taxes in the other companies that it operates out of.
Details of the tax payment that was due almost can to a row after it was revealed that Starbucks, Google, and Amazon have all been legally bending the rules just enough to avoid paying taxes to the UK government. Tui clearly stated that the company is ‘compliant’ with UK tax law and explained that it believes it will have to pay a small amount of corporation tax next year and then larger amounts in the next few years as their losses were cancelled out.
For now, the company said that Tuesday’s final profits are the result of the package holiday which customers are choosing more and more often now. They added that there has been a strong demand for holiday trips next year as households are starting to plan their summer holidays early so that they do not have to miss out on them. Still, price-for-like holidays may go up by as much as 2% due to compounding fuel costs that are also expected to increase next year which may hurt Tui’s profits slightly.