Symantec hit with US$1 billion tax bill

Symantec hit with US$1 billion tax bill

The IRS has hit Symantec with a $1 billion tax bill relating to IP transfer's to the company's international subsidiaries.

The US Internal Revenue Service has hit Symantec with a $US1 billion tax bill for allegedly under-reporting the value of intellectual property that the software vendor transferred to two Irish subsidiaries.

Symantec was notified of the issue by the IRS in late March, the company said in a regulatory filing.

The IRS claims that both Symantec and Veritas Software under-priced intellectual property the two companies licensed to Irish subsidiaries, according to a Symantec spokesperson.

Both Symantec and Veritas, which was purchased by Symantec in 2005, set up the Irish subsidiaries for the purpose of doing business outside of the US, she said.

The IRS claims Symantec owes about $US900 million, excluding penalties and interest, in connection with the Veritas claim, which covers the 2000 and 2001 Veritas tax returns. Another $US100 million is due in connection with Symantec's fiscal 2003 and 2004 reports.

Symantec does not agree with the IRS and plans to appeal the tax assessment, the company spokesperson said.

Symantec's stock dropped more than 4 per cent following the news, trading at $US15.73 in after-hours Nasdaq trading.

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