Digital Services Tax Calculator
Calculate the UK Digital Services Tax (DST) on revenues from social media, search engines, and online marketplaces. DST is 2% on UK revenues over £25m, applied to groups with >£500m global digital revenues.
Frequently Asked Questions
What is the UK Digital Services Tax?
The Digital Services Tax (DST) is a 2% levy on UK revenues of large digital businesses — specifically online marketplaces, social media platforms, and search engines. It was introduced in April 2020 as a temporary measure pending international digital tax agreement under Pillar One (OECD).
Who pays DST?
Groups with more than £500m in global digital revenues from in-scope activities AND more than £25m in UK revenues. The first £25m of UK revenues is exempt. Both thresholds are assessed on a group-wide basis.
What revenues are in scope?
In-scope revenues: online marketplace fees (transaction facilitation, listing fees), social media advertising revenues attributed to UK users, and search advertising revenues attributed to UK users. Out of scope: financial services, sale of own goods, streaming services, and online advertising by non-marketplace/social/search businesses.
Is there a safe harbour for loss-making businesses?
Yes — if the group's operating margin from in-scope activities is negative (loss-making), only 50% of the DST is payable. This prevents DST from acting as an insolvency-accelerating levy for struggling digital businesses.
How is DST connected to Corporation Tax?
DST is a separate tax — it is not deductible against Corporation Tax (unlike most business taxes). It is a top-line revenue tax, not a profit tax. HMRC recognises this creates double-taxation risk, which is why DST is intended as temporary pending Pillar One.
When will DST be abolished?
The UK government has committed to withdrawing DST when the OECD's Pillar One solution (which would reallocate taxing rights on large digital company profits to market jurisdictions) comes into force. Implementation of Pillar One has been delayed; DST therefore remains in force for 2026.
How is DST declared and paid?
Groups must self-assess and file a DST return annually. Payments are made on account with quarterly payments (similar to CT instalments for very large companies). Returns are due 12 months after the group's accounting period end.
Does DST apply to non-UK companies?
Yes — DST applies regardless of where the group is headquartered or where the digital service is provided from. What matters is whether users are in the UK and whether the group exceeds the thresholds. Many US tech giants (Facebook, Google, Amazon) are significant DST payers.