Apple Expects Appeal of Irish Tax Ruling to Take 'Several Years' With No Impact on Near-Term Financial Results

Following the European Commission's ruling that Apple received illegal state aid from Ireland, and must pay $14.5 billion in back taxes to the country, the company has published a new FAQ that addresses potential concerns investors may have about the decision and the effect on its bottom line.

Apple-EU
Apple started out by confirming the decision is not final and that it plans to appeal. The company is "confident" the ruling "will be overturned" by courts in the European Union, but it notes the process is "likely to take several years." In the meantime, Apple does not expect any near-term impact on its financial results.

How does this decision impact Apple’s near-term financial results?
Will you take a tax charge? Does this alter your previous guidance?

We do not expect any near-term impact on our financial results nor a restatement of previous results from this decision. We have previously accrued U.S. taxes related to the income in question. The tax rate guidance for Apple’s fourth fiscal quarter that we provided on July 26, 2016 does not change as a result of this decision.

Apple added that it does not currently expect the decision to have an impact on its tax rate or cash balance going forward, but the company anticipates it will place an unspecified amount of cash in an escrow account. Apple expects the amount will be reported as restricted cash on its balance sheet.

The European Commission's ruling followed a three-year inquiry into Apple's tax arrangements in Ireland, where it paid between 0.005% and 1% in taxes from 2003 through 2014, compared to the country's headline 12.5% corporate tax rate. Apple insists it "follows the law and pays all of the taxes" it owes.

Note: Due to the political nature of the discussion regarding this topic, the discussion thread is located in our Politics, Religion, Social Issues forum. All forum members and site visitors are welcome to read and follow the thread, but posting is limited to forum members with at least 100 posts.

Top Rated Comments

(View all)
Avatar
47 months ago
Pay your ****ing taxes. I pay mine.
Score: 45 Votes (Like | Disagree)
Avatar
47 months ago

I don't understand EU tax law. It seems Ireland's own laws says what Apple is doing is legal.

It's not EU tax law, it's EU competition law.
EU competition law forbids special deals that amount to state aid to companies.
The state aid happened to have taken the form of reduced taxes.
Score: 16 Votes (Like | Disagree)
Avatar
47 months ago
As I understand the money will have to be collected soon, along its interest which makes it a lot more, and then it sits in a fund that cannot be touched by Apple it Ireland or anyone else whilst they go through the appeals process.

Personally I think Apple firstly being almost fraudulent in its tax payments dodging, and then posting a letter to Europe claiming they are innocent and Ireland was nothing till they showed up, will have lost them some sales.
We shall see though. You don't bite the hand the feeds you which is EXACTLY what Tim Cook has done today by threatening any further EU investment now because of their tax dodging being exposed. That arrogant American attitude doesn't win over European consumers Tim.
Score: 15 Votes (Like | Disagree)
Avatar
47 months ago
I don't understand EU tax law. It seems Ireland's own laws say what Apple is doing is legal.
Score: 12 Votes (Like | Disagree)
Avatar
47 months ago

Except the EU itself is hardly popular in the EU itself right now, and it could also come across as "why the hell is the EU interfering in the tax laws of a member state? Shouldn't they have the right to do whatever they want? A lot of people feel the EU is interfering too much. So it could go either way really.

You have severely underestimated the attitudes of Europeans towards giant corporations, this is actually a good thing. The EU provides a hell of a lot better consumer laws then America does and no one is complaining about that!
Score: 9 Votes (Like | Disagree)
Avatar
47 months ago

Just curious... how much cash do they have stored in the bank again?

Let's put it this way, the tax demand is about 6% of their cash on hand. But they'll fight it tooth and nail for years, even if they'll have to spend those 6% on tax attorney fees.
Score: 8 Votes (Like | Disagree)

Top Stories

Leaker Claims New 13-inch MacBook Pro Coming as Soon as Next Month

Monday April 6, 2020 2:56 am PDT by Tim Hardwick
Apple will announce a new 13-inch MacBook Pro in May with the codename J223, according to a rumor shared by YouTuber and leaker Jon Prosser. Note: it’s a refresh to the current 13” So the bigger 14” display upgrade is a big possibility— Jon Prosser (@jon_prosser) April 4, 2020 Analyst Ming-Chi Kuo has said Apple plans to release new MacBook Pro and MacBook Air models with scissor keyboards ...

iOS 14 Could Offer Home Screen Widgets, Wallpaper Customizations

Saturday April 4, 2020 3:30 pm PDT by Frank McShan
iOS 14 could offer home screen widgets and wallpaper customizations for the first time, according to 9to5Mac and Twitter user DongleBookPro. Apple is reportedly working to implement widgets that can be moved freely around like icons on the iPhone and iPad homescreen for the very first time. The feature is reportedly codenamed "Avocado" and no other details are available. It was also...

Top Stories: Apple Leaks iPhone SE and AirTags, Apple Buys Dark Sky, and More

Saturday April 4, 2020 6:00 am PDT by MacRumors Staff
With the calendar rolling over to April this week, we yet again saw several leaks and rumors, most notably including Apple itself leaking some references to a pair of long-rumored products: a new budget iPhone SE and AirTags item trackers. Subscribe to the MacRumors YouTube channel for more videos. Apple also acquired popular weather app Dark Sky, while Amazon's Prime Video app now allows...

Apple Music Was Second Biggest Global Music Streaming Service in 2019

Friday April 3, 2020 5:38 pm PDT by Juli Clover
Global online music streaming subscriptions were up 32 percent year-over-year in 2019, hitting 358 million subscribers, according to new estimates shared today by Counterpoint Research. Spotify was the market leader with a 31 percent share of total revenue and a 35 percent share of total paid subscriptions, while Apple Music earned the second place slot with a 24 percent share of total...

More References to Apple's Upcoming Low-Cost iPhone Appear Online

Monday April 6, 2020 4:38 am PDT by Tim Hardwick
Further references to Apple's upcoming low-cost iPhone have appeared online, one on a Chinese e-commerce website and another on Verizon's smartphone trade-in page. Spotted by tech blog MySmartPrice, Chinese retailer JD.com has published a placeholder for Apple's so-called "iPhone 9" that includes a teaser image of a veiled smartphone, but other than that it lacks any particularly revealing...

The New York Times, IFTTT, Medium, and Other Apps Adopt Sign in With Apple Ahead of June 30 Deadline

Sunday April 5, 2020 7:08 pm PDT by Frank McShan
Apps with sign-in functionality, including The New York Times, IFTTT, Medium, and more, have continued to adopt Apple's secure Sign in with Apple feature ahead of a deadline of June 30. The deadline for these apps to support the feature was recently extended from April 30. Sign in with Apple, first introduced in iOS 13, allows users to create accounts for apps and websites using an Apple ID. ...

Apple Offers Employees Deep Discounts on HomePod, Beats Headphones and More

Friday April 3, 2020 11:14 am PDT by Juli Clover
Apple is offering employees significant discounts on products that include the HomePod and Beats headphones, according to details on the deals shared by MacGeneration and 9to5Mac. Apple is said to be clearing stock of Beats headphones and HomePods, providing them to employees through an internal deals program. The HomePod is available at a 50 percent discount, dropping the price to $149.50,...

New Low-Cost 'iPhone SE' Could Launch as Soon as Tomorrow

Thursday April 2, 2020 4:06 pm PDT by Juli Clover
Apple's new low-cost iPhone is set to launch as early as Friday, April 3, according to a new report from 9to5Mac that cites a tip from a "highly trusted reader." The site says that while it can't be certain about the launch date, "Apple could reveal and begin taking orders for the new iPhone as soon as tomorrow." The iPhone 8 Apple is said to be planning to call the new iPhone, which is...

EPIX Available for Free Through Apple TV Channels Until May 2, No Subscription Required

Saturday April 4, 2020 9:28 am PDT by Frank McShan
EPIX is currently offering free access to its catalog of movies and TV shows through the Apple TV Channels feature in the TV app, and many additional services are also offering extended free trials. Upon navigating to the Apple TV app, users will notice that EPIX is listed under the "My Channels" section. Rather than offering an extended trial where users must first sign up, EPIX is...

iPad Launched 10 Years Ago Today, App Developer Reflects on Getting Access to a Top-Secret Prototype

Friday April 3, 2020 10:53 am PDT by Joe Rossignol
On the 10th anniversary of the iPad launching in stores, Agile Partners co-founder Jack Ivers has shared an interesting story about how his company managed to get in Apple's good graces and ultimately gain access to prototype iPads. The story begins in 2008, when Agile Partners released GuitarToolkit as one of the first iPhone apps on the App Store. The app used the iPhone's microphone to...