The view that business and Twitter do not always mix has been reinforced by an out-of-court settlement from a British flooring company that posted a tweet saying a French rival paid no tax.

Polyflor, a subsidiary of James Halstead, a listed Manchester business, has apologised and joined Tarkett, which sued over the claims, in donating £50,000 to the BBC’s Children in Need charity.

The legal action concerned a Polyflor tweet in December. It included a link to a document titled “The Starbucks debate” prepared by Gordon Oliver, James Halstead’s finance director.

It said Polyflor paid tax of £18 million in 2009-2011 while Tarkett did not pay anything, while Mr Oliver wrote of the need for a “level playing field”.

Tarkett said the tweet was defamatory and had been seen by people working in the flooring industry. The document was also emailed and handed out to some Polyflor and Tarkett customers.

Polyflor said in a statement that “it did not seek to allege that Tarkett had avoided paying corporation tax in the UK for the financial years ending 2009-11 through the use of artificial profit-shifting devices.

–(Finacial Times service)