Facebook’s main Irish subsidiary paid an additional €35 million to settle outstanding tax matters last year as the amount of money it set aside to cover potential fines from regulatory investigations increased to more than €1 billion.
Revenues jumped by €6.3 billion to €40.6 billion at Facebook Ireland in 2020 as pre-tax profits rose to €890 million from €482 million a year earlier.
The company, which employs more than 2,000 people locally, paid out €20 million in dividends to its parent on the back of the strong performance.
It attributed the sharp rise in turnover to growth in advertising revenues from third-party providers.
The company’s corporate tax liability rose to €266.3 million from €173.2 million, largely as the result of it agreeing a resolution to tax matters and paying an additional €35 million to the Revenue Commissioners. This comes after the company’s tax liability in 2019 increased almost threefold from €63.2 million as it paid €53 million in additional taxes to the Irish exchequer.
The amount Facebook set aside for possible administrative fines arising from investigations from data protection authorities more than trebled from €302.3 million to €1.02 billion. It predicted regulatory matters would be resolved within the next two years.
Facebook Ireland, whose parent recently rebranded as Meta, reported a surge in administrative expenses, which increased by €5.3 billion to €37.9 billion in 2020. It said the jump in expenses was linked to continued growth in business operations and additional payables to fellow group companies.
“Business operations continued to grow during the year which drove the increase in headcount-related expenses and intercompany expenses,” Facebook said.
During 2020, headcount rose 16 per cent to 2,247 from 1,944 in the prior year. Staff costs, including wages and salaries, increased to €377.8 million from €324.3 million.
A breakdown of employee roles reveals that 700 people worked across sales, with 666 in community operations and 540 in administration. A further 341 people were employed as engineers.
The company incurred €56 million in research, development and engineering expenses in 2020, up from €39 million in 2019.