Wednesday, May 22, 2024

Symantec’s $1B Tax Bill

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It’s true. Blockbuster mergers can sometimes come back to bite the buyer.

Security software giant Symantec said in a Securities and Exchange filing
that it owes the government $1 billion in unpaid taxes, mostly relating to
an audit of its purchase of Veritas Software.

Symantec, which has watched its shares drop since it purchased
Veritas for $10.5 billion last summer, said the IRS is
claiming that the company owes more taxes, plus interest and penalties, for
2000 and 2001.

Symantec said its tax liability with regard to the Veritas claim would be
$900 million, excluding penalties and interest.

The Cupertino, Calif., company also said the IRS claim relates to transfer
pricing in connection with a technology license agreement between Veritas
and a foreign subsidiary.

Symantec said that the IRS informed the company that an unrelated audit of
Symantec for fiscal years 2003 and 2004 could cost the company another $100
million in taxes, excluding penalties and interest.

These proposed adjustments also relate to transfer pricing between Symantec
and a foreign subsidiary.

If the combined audits are borne out, Symantec would owe the government at
least $1 billion.

This article was first published on InternetNews.com. To read the full article, click here.

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