Netflix is latest multi-million-pound global company that does not pay UK corporation tax despite generating £200m of revenue in Britain

Netflix the online movie rental service did not pay any UK corporation tax last year, despite generating an income of £200million in Britain.

The world’s biggest internet movie streaming service has five million subscribers in the UK alone and has proved a hit by offering U.S. shows like House of Cards and the BBC’s Sherlock.

But the company has been quick to defend its decision to avoid paying UK tax saying it is making ‘overall losses’ on its international ventures.

It did, however, pay tax in Luxembourg last year totalling £573,396.

Figures obtained by The Sunday Times showed that its Dutch arm – Netflix International BV – had a net turnover of £415million and profits of £11.3million.

British customers, who typically pay £5.99 a month for the service are given contracts from Netflix BV.

This means that profits generated by Netflix International BV – which was Dutch-based until 2014 – included UK subscriptions.

In contrast, Netflix Services UK, the British arm of the firm, was given an income tax credit of £35,000.

Overall, Netflix had global revenues of $5.5 billion and profits of $267 million.

The firm, founded in California in 1997, is expected to have 100 million global subscribers by 2018 and is the most popular service of its kind in the UK.

It said that it does expect to pay some UK corporation tax this year, The Sunday Times reports.

Chancellor George Osborne has been called upon to ‘get a grip’ on the issue of Netflix’s UK tax contribution by Labour’s shadow Treasury minister Richard Burgon.

Mr Burgon criticised the Chancellor closing 153 HMRC tax offices, suggesting it helped companies to ‘undermine’ British business.

He said: ‘George Osborne needs to get a grip of this issue in the new year as after being Chancellor for five years he has no-one else left to blame but himself.

‘Many families will be paying to sit down together this Christmas to watch programmes on Netflix and won’t expect that the money they give may be undermining British businesses.

‘It’s the businesses and taxpayers who pay their taxes who have to carry the burden for those who do not.

‘This only further makes George Osborne’s decision to close 153 tax offices at HMRC look like another mistake from a Chancellor who, only last month, was shown over the police and tax credit u-turns to cut first and think later.’

HMRC said that important work had been done to ensure companies pay their ‘fair share’ of tax.

A spokesman said: ‘HMRC is clear that multinational companies must pay the tax that is due and we do not settle for less.

‘The Government has led the way in taking action to ensure multinational companies pay their fair share of taxes, including introducing the diverted profits tax to make it harder for multinationals to divert profits out of the UK.

‘We have also played a critical role in the OECD’s project to reform the international corporate tax system to prevent tax avoidance.’

However, it is not the only global corporation revealed as paying little or no tax in the UK.

Campaigners have blasted Amazon’s booming UK business which paid just £11.9million of tax last year but took £5.3billion of sales from British internet shoppers.

Meanwhile, coffee giant Starbucks has also been called into question after it paid £8.6million in UK corporation tax since it opened its first shop in London’s Kings Road in 1998.

Caffé Nero has not paid corporation tax in the UK since 2008, despite racking up sales worth £1.2 billion.