Symantec to challenge $900m tax demand for Veritas acquisition

Symantec has received a $900m (£500m) bill for back taxes relating to its £7.2bn acquisition of data management firm Veritas in July 2005.

Symantec has received a $900m (£500m) bill for back taxes relating to its £7.2bn acquisition of data management...

firm Veritas in July 2005.

The US Internal Revenue Service has served a Notice of Deficiency claiming that the company owes $900m in additional taxes, plus interest and penalties, for the 2000 and 2001 tax years.

The additional tax demand is based on an audit of Veritas and has arisen primarily from transfer pricing in relation to a technology licence agreement between Veritas and a foreign subsidiary.

Symantec has also received notices of proposed adjustments that would add another $100m, plus penalties and interest, to its tax bill. These relate to an unconnected audit for the 2003 and 2004 financial years.
The company said it would challenge the IRS over the tax demands. In a statement filed with the US Securities and Exchange Commission, Symantec said, “The company strongly believes the IRS positions with regard to these matters are inconsistent with applicable tax laws and existing Treasury regulations, and that its previously reported income tax provision for the years in question is appropriate.

“The company does not agree with the IRS position and intends to file a timely petition to the tax court to protest the assessment. No payments will be made on the assessment until the issue is definitively resolved,” it said.



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