By Lauren Howells.

Facebook’s UK tax bill totalled £15.8 million last year, up from £5.1 million in 2016.

Profits, meanwhile, only increased by 7.45% year-on-year, with £58 million reported in 2016 and £63 million in 2017.

Facebook’s UK revenue last year hit £1.26 billion, compared to £842.2 million in 2016.

According to the Telegraph, Facebook said its revenue increased due to improved “intercompany services and advertiser reseller activities in 2017”.

“We have changed the way we report tax…”

“We have changed the way we report tax so that revenue from customers supported by our UK teams is recorded in the UK and any taxable profit is subject to UK corporation tax,”

said Steve Hatch, Facebook’s VP of Northern Europe.

Last year was the first full year where all revenue from large UK customers was recorded in the UK and any taxable profit was subject to UK corporation tax. This was part of a local reseller structure that Facebook introduced on 1st April 2016.

According to the BBC, Facebook gave out 1.48 million restricted ordinary shares (RSU) to employees last year, which the BBC described as a move “that reduces its tax liability”. It added that this was one million fewer shares than were given out in 2016.

Chancellor Philip Hammond discusses “digital services tax”

Large tech firms have come under scrutiny in recent years regarding the level of tax they pay in the UK and mainland Europe.

Last week, Chancellor of the Exchequer, Philip Hammond, discussed the possibility of a “digital services tax” to tackle the problem.

UK home to Facebook’s largest engineering base outside the US

Outside of the United States, the UK is home to Facebook’s largest engineering base. The company increased its UK employees by 34% in 2017. By the end of 2018, Facebook says it plans to have 2,300 employees in the UK.

By 2021, Facebook intends to double its office space in the UK, with a total capacity of over 6,000 workstations, when it moves into its new buildings in London’s King’s Cross.

In other news, it emerged that PayPal had reportedly agreed to pay an extra £2.7 million in tax after a review by HMRC.