Wightlink has paid no corporation tax in the UK for two years – and here’s why

Victoria of Wight
Victoria of Wight

FERRY firm Wightlink has paid no corporation tax for the past two years, it has been revealed.

But the company, which runs a Portsmouth-Wightlink service, has said a huge £30m investment in a new ferry, and port improvements, meant it did not have to pay.

It comes as Yo Sushi owner Mayfair Equity Partners bids to buy the firm, according to reports from Sky News.

READ MORE: Wightlink’s new ferry Victoria of Wight

A Wightlink spokeswoman said: ‘No corporation tax has fallen due for Wightlink as a result of the high levels of investment it makes in building new ferries and improving facilities for customers. This applies to any company which reinvests its profits to renew its assets.

‘Wightlink has recently invested £45million in its new flagship Victoria of Wight and modernising port infrastructure on the Portsmouth to Fishbourne route.

‘Wightlink makes and declares all its profits within the UK.’

It comes after Isle of Wight MP Bob Seely questioned why a £14m divided had been paid to shareholders but no corporation tax was paid.

According to reports he wrote to the firm, along with Department for Transport and the Treasury,

He said: ‘Wightlink appears to pay no tax on its earnings. Equally, the holding companies do not seem to pay any tax either.

‘Wightlink appears to be making a good profit paying shareholders — a dividend of £14 million.

‘When would Wightlink or its shareholders expect to start paying UK tax on its earnings?

‘Wightlink’s immediate holding company, Arca Top Co, while registered in the UK, is controlled from Luxembourg and its parent company is registered in Guernsey.

‘If this is correct, why is Wightlink’s corporate structure offshore? Has this structure been put in place to minimise tax liabilities?

‘What benefit is there for the island in this arrangement? What benefit is there for the UK taxpayer?’

The firm is set to respond to Mr Seely.

Wightlink could be bought for as much as £300m, up from the £230m paid by current owner Basalt Infrastructure Partners in 2015.