How Nike pay less tax by

charging themselves for

intellectual property

1

Regular accounting

Money from shoe sales across Europe, the Middle East and Africa all flow into Nike’s European headquarters in the Netherlands. The amount of tax due is determined by its reported net profits

Revenues

Taxable income

Costs

Net profit

Tax paid

2

Minimum-profit accounting

A subsidiary of the company charges the Dutch headquarters for intellectual property rights, resulting in much lower taxable profits

Revenues

Taxable income

Costs

Net profit

Payments to

subsidiary

Tax paid

Guardian graphic | Nikolaus Kommenda,

Josh Holder and Cath Levett

How Nike pay less tax by charging

themselves for intellectual property

1

Regular accounting

Money from shoe sales across Europe, the Middle East and Africa all flow into Nike’s European headquarters in the Netherlands. The amount of tax due is determined by its reported net profits

Revenues

Taxable income

Costs

Net profit

Tax paid

2

Minimum-profit accounting

A subsidiary of the company charges the Dutch headquarters for intellectual property rights, resulting in much lower taxable profits

Revenues

Taxable income

Costs

Net profit

Payments to

subsidiary

Tax paid

Guardian graphic | Nikolaus Kommenda, Josh Holder and Cath Levett

How Nike pay less tax by charging themselves for intellectual property

1

Regular accounting

Money from shoe sales across Europe, the Middle East and Africa all flow into Nike’s European headquarters in the Netherlands. The amount of tax due is determined by its reported net profits

Revenues

Taxable income

Costs

Net profit

Tax paid

2

Minimum-profit accounting

A subsidiary of the company charges the Dutch headquarters for intellectual property rights, resulting in much lower taxable profits

Revenues

Taxable income

Costs

Net profit

Payments to

subsidiary

Tax paid

Guardian graphic | Nikolaus Kommenda, Josh Holder and Cath Levett

How Nike pay less tax by charging

themselves for intellectual property

1

Regular accounting

Money from shoe sales across Europe, the Middle East and Africa all flow into Nike’s European headquarters in the Netherlands. The amount of tax due is determined by its reported net profits

Revenues

Taxable income

Costs

Net profit

Tax paid

2

Minimum-profit accounting

A subsidiary of the company charges the Dutch headquarters for intellectual property rights, resulting in much lower taxable profits

Revenues

Taxable income

Costs

Net profit

Payments to

subsidiary

Tax paid

Guardian graphic | Nikolaus Kommenda,

Josh Holder and Cath Levett