Netflix Reports £1.4 Billion in Revenue Last Year Thanks to UK Subscribers | netflix

Netflix, the US streaming service with hits such as The Crown and Stranger Things, has revealed its annual revenue from UK subscribers for the first time – £1.4 billion in 2021 – after changing its accounting practices in a move which also saw his corporation tax payment rise sharply to nearly £7million.

Netflix’s main UK business saw a 1,630% increase in revenue last year, from just £79m in 2020, after abandoning the widely criticized practice of channeling UK revenue through other European jurisdictions low-tax rates that are commonly used by Silicon Valley companies.

The latest UK accounts mark the first time Netflix has failed to account for the more than £1bn it earns each year from monthly fees paid by UK subscribers through separate accounts at its European headquarters in the Netherlands. .

The decision to reallocate all revenue from its 13.8m UK subscribers to its UK subsidiaries in turn fueled a near tripling of pre-tax profits from £10.6m to £27.9m at Netflix Services UK, the main entity that the streaming company has registered with the companies. Accommodation.

Last year, Netflix paid nearly £7m in UK corporation tax on total profits of £31.7m across the country’s three registered businesses, the most than it’s paid since it launched in the UK in 2012. That’s almost double the £4 million. paid in 2020.

In November 2020, Netflix, which reinvests a significant portion of its revenue into an annual budget of £1billion to make TV shows and films in the UK, pledged to start reporting revenue. UK subscribers every year from 2021.

Last week it emerged that Facebook UK had paid £29.8million in corporation tax, after taking £3.3billion in gross revenue from advertisers. Google, owner of YouTube, paid £200m in tax; research firm Insider Intelligence estimates that the company made almost £8.7 billion in advertising revenue in the UK.

Netflix’s latest accounts also show the scale of the company’s expansion in the UK, its largest production hub outside the US, with a 44% increase in the number of employees for reach 396 last year.

The 153 staff at Netflix Services UK received an average salary of £241,830 last year, with payroll costs rising from £25m to £37m as the number of staff rose from 108 in 2020.

Netflix Studios UK, which is responsible for in-house made shows, has increased its staff from 160 to 225. The £59.5million in staff costs equates to an average salary of £264,000. The third entity, Netflix Productions, employs just 18 people and had payroll costs of £2.17million last year.

Netflix UK previously received a fee of almost €100m (£88m) to operate as a service arm for its European headquarters. Accounts show Netflix UK paid a £50million dividend to its Dutch parent company in August this year.

A Netflix spokesperson said: “The UK has one of the world’s leading film and TV industries, which is why we invest more in production here than anywhere else outside of North America. Last year, we spent over a billion dollars, created thousands of jobs, and made world-class series and movies in every corner of the country.

“We are committed to investing in the UK’s creative community, closing the skills gap and creating high quality jobs on some of our biggest global hits like Bridgerton, The Witcher and Three-Body Problem.”

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