UK deal nets Tyco £700m tax bill
US conglomerate Tyco International will have to pay a massive bill in backdated taxes, following the uncovering of fresh accounting problems at a UK subsidiary.
The bill in after tax charges is expected to be $1.1bn (£690m) following an SEC investigation of Tyco’s acquisition of security alarms business ADT in 1997, according to reports.
Tyco has been under investigation since October 2002 after disclosing $2bn in accounting errors, and the tax charges are reported to relate to the manner in which Tyco amortised the assets of ADT.
The company has since introduced more conservative accounting methods.
ADT was owned by former Tory party treasurer Lord Ashcroft before it was sold to Tyco for $7bn.