Mobile phone operator Vodafone has reportedly hit multimillion-pound tax bill settlement with the UK government's HM Revenue & Customs (HMRC) for one of its Irish subsidiaries.

The UK-based mobile giant didn't reveal the size of the settlement, but said that the settlement was related to numerous technical factors pertaining inter-group arrangements of transfer pricing.

Vodafone used an Irish subsidiary, Vodafone Ireland Marketing Ltd, to collect millions of pounds per year in royalty payments from companies using its brand as well as joint ventures (JVs) from across the globe.

By the year 2007, the subsidiary was reporting a turnover of a whopping £320 million (_380M) per year. Surprisingly, the subsidiary employed no staff from 2002 to 2007.

The royalty payments allowed the company to offer attractive dividends to its various companies around the globe. It was the advantage of low corporation tax rates in Ireland that helped the company offer those dividends.

The settlement in question was hit in 2009, but the company never disclosed the Irish settlement separately in its annual reports.

Vodafone also welcomed criticism from British campaigners after it admitted that it hadn't paid any corporation tax in Britain for two years because of difficult operating conditions.