Glencore revealed the demand yesterday when publishing its preliminary results for 2018.
“In December 2018, HMRC issued formal transfer pricing, permanent establishment and diverted profits tax assessments for the 2008 – 2017 tax years, amounting to $680m,” the results showed.
The company said it “intends to appeal and vigorously contest these assessments” as various legal opinions and detailed analysis support its position and policies applied during the period in question.
“Management does not anticipate a significant risk of material changes in estimates in this matter in the next financial year,” Glencore added.
A HMRC spokesperson said it does not comment on identifiable taxpayers.
In 2017, HMRC increased the number of challenges on large businesses due to suspicion that £5.8bn was being underpaid through transfer pricing.
Last year, it announced that it had yielded a record £388m from diverted profits taxes in 2017/2018 –a 38% increase year-on-year.
Glencore is headquartered in Switzerland and registered in Jersey and has businesses, including its oil trading company Glencore Energy UK, based in London.
The outcome of this most recent case is likely to have ramifications for other multinational businesses.
Last year, mining giant BHP Billiton paid £299m after reaching a settlement with the Australian Tax Office following a long-running dispute involving its marketing operations in Singapore.