How to Avoid Tax as a Megacorp

Let's pretend that we own a company that makes widgets. Our widgets sell for £1 each, it costs £0.80 to make a widget, so we're making £0.20 profit per widget.

Clearly, as an honest company, we pay tax on that £0.20.

Our widgets are very high quality, but we're new to the market and don't have name recognition. BigWidget are the brand leaders, and they agree that we can use their name (and follow their quality standards) for, oh, £0.20 per widget.

We agree to the deal, and add the £0.20 licencing cost to our expenses, meaning that we don't make a profit and we stop paying tax.

Why would we agree to that? Well, we're 100% owned by BigWidget and they're based in a jurisdiction that has a zero tax rate.