Top UK betting firm moves HQ to Malta, saving millions in taxes
'I know lots of people who’ve gone to Malta. They've all either gone there for sunbathing or to avoid tax,' - tax expert
One of the UK’s largest gambling firms, Sky Bet, has relocated its headquarters to Malta, potentially saving £55 million in tax annually, ITV has reported.
"The change will mean less money for the government at a time when the public finances are under strain," the UK broadcaster said.
It reported that Sky Bet, which describes itself as “the UK’s No. 1 betting app,” has moved its sportsbetting business to the Maltese branch of a new UK company, SBG Sports Limited.
Flutter Entertainment PLC, Sky Bet’s parent company, told staff about the move in June, alongside a plan to make around 250 people in the UK redundant. It said it needed to operate more efficiently and to reduce costs.
Steve Birch, chief commercial officer of Sky Betting and Gaming, had explained that from November 1, “day-to-day commercial and marketing decision making would take place in Malta,” although Sky Bet’s Leeds office would continue to be one of Flutter’s largest, ITV said.
It quoted tax expert Dan Neidle as saying that the company could save £55 million annually, based on last year's profit, since Malta-based companies pay an effective corporation tax rate of 5% compared with 25% in the UK. The figure also includes VAT savings.
“I know lots of people who’ve gone to Malta. They've all either gone there for sunbathing or to avoid tax. I don't know anyone who's gone there for any other reason,” he told ITV News.
But Neidle warned that Sky Bet is taking a big risk.
“If I had been advising them, I'd say that it was reckless. The risk is that there's a lot of expense in moving people to Malta, and then they're stuck. And if the law changes [or] HMRC challenges their position, they could end up, in fact, saving nothing, but being stuck in Malta.”
Flutter recently shifted its primary stock market listing to New York but has retained a secondary listing in London.
The company calls itself “the world’s largest sports betting and iGaming operator” and is valued at around £30 billion.
Flutter’s UK betting brands also include Paddy Power and Betfair - both registered in Ireland and Malta.
Sky Bet applied for a sports betting licence in Malta in 2017. At the time Prime Minister Joseph Muscat had hinted at a "household name" in the gaming sector seeking to relocate to Malta.