- Amazon UK Services received a £7.6m tax credit in 2025.
- Pre-tax profits rose 26.5 per cent to £355m.
- Tax campaigners renewed calls for greater transparency over Amazon's UK tax affairs.
Amazon UK tax payments have come under fresh scrutiny after the company's main British division received a £7.6 million tax credit in 2025, despite reporting a sharp rise in profits.
New company filings show Amazon UK Services, which runs much of the retailer's online shopping, logistics and warehouse operations in Britain, increased pre-tax profits by 26.5 per cent to £355 million. Revenue also climbed 11 per cent to £8.2 billion during the year.
The company initially recorded a current tax charge of £9.1 million. However, that figure was more than offset by a £16.7 million adjustment linked to previous periods, resulting in a net tax credit of £7.6 million.
The adjustment is understood to be connected to government-backed tax reliefs designed to encourage investment in UK infrastructure and business expansion.
Amazon UK Services invested £5.2 billion during the year, including spending on fulfilment centres, datacentres, machinery, equipment and office facilities. The company said the investment formed part of a wider £40 billion commitment to the UK.
An Amazon spokesperson said the business had opened a new fulfilment centre in Hull, developed a major site in Northampton and expanded operations in London and Swansea, while continuing to grow its delivery and datacentre networks.
The company employs around 66,000 people through Amazon UK Services, accounting for most of its 75,000 UK workforce.
Fresh debate over corporate tax
The latest filings have also revived questions over how much corporation tax Amazon pays across its wider UK operations.
According to an analysis by the Fair Tax Foundation, five major Amazon divisions generated combined pre-tax profits of £555 million in 2025, up from £455 million a year earlier. During the same period, their combined current tax charge fell from £126 million to £63 million.
The organisation estimated that the actual UK corporation tax paid across those operations was around £39 million, equivalent to an effective tax rate of roughly 7.1 per cent.
Paul Monaghan, chief executive of the Fair Tax Foundation, said, as quoted in a news report, that Amazon had enjoyed another year of low corporation tax payments despite strong profitability. He also questioned how rival retailers could compete under such circumstances.
Amazon rejected suggestions that the filings reflect the full scale of its tax contribution. The company said it paid more than £1.3 billion in direct taxes in the UK during 2025, including corporation tax, employer National Insurance contributions, business rates and other levies. It added that its total tax contribution exceeded £6.5 billion.
The company also argued that investment activity can significantly affect corporation tax liabilities from year to year.
The Luxembourg question remains
Questions continue to surround the way Amazon records a substantial portion of its European revenues through Luxembourg.
Company filings indicate that roughly half of Amazon's estimated £32 billion UK revenue is channelled through its Luxembourg-based business, which also handles income from several other European markets. That operation reported revenues of about £79.3 billion and paid around £54.4 million in tax during the year.
Monaghan said, as quoted in a news report, that a large share of Amazon's UK income continues to be booked through Luxembourg and called for greater disclosure of the company's profits and tax payments on a country-by-country basis.
While Amazon insists it remains one of the UK's largest taxpayers and investors, the latest figures are likely to fuel a wider debate over how multinational companies are taxed and whether existing rules accurately reflect where profits are generated.
