Vodafone's Irish office with no staff and multi-million pound tax deal with HMRC Vodafone Group issued the following statement in response to the story: Vodafone conducts itself in full compliance with the law and always operates under a policy of full transparency with the tax authorities in all countries in which we operate. 'Vodafone's relationship with tax authorities is based on complete disclosure and a rigorous adherence to due process at all times. 'Vodafone's Group brand and marketing function was established during a period of significant international expansion and as a global business it is feasible to locate centralised Group functions in a number of different locations depending on a range of factors. In 2001, Dublin was identified as a location for this activity on a number of grounds including the commercial, regulatory and tax environment in Ireland at that time and Vodafone began to use a Dublin-based subsidiary to collect royalties and brand management fees from operating companies and partners to fund the development of the Vodafone brand around the world. 'Vodafone's relationship with tax authorities is based on complete disclosure and a rigorous adherence to due process at all times' The royalty payments that were made were done so under domestic and international transfer pricing rules which are set up by governments to allocate appropriate taxable profits from one country to another. 'The company's local UK and Italy operating companies continued to pay fees to Vodafone Group in the UK and no royalties have ever been paid from the UK to Ireland or elsewhere. The settlement with HMRC related to a number of technical factors regarding inter-Group transfer pricing arrangements. Notably, throughout the period covered by the settlement, the profits of VIML had been taxed by the Irish authorities at the rate of 25 per cent. In accordance with the Treaty between the UK and Ireland which prevents double taxation on the same income, the Irish government credited taxes previously paid by Vodafone and these were then paid to the UK Treasury as part of the overall settlement. 'This was disclosed in Vodafone's annual report and accounts. In 2011, the Vodafone Group revisited the decision to locate its brand activities in Ireland and decided instead to consolidate the global brand and marketing function within the UK from October.