You will find a Travelex foreign exchange booth in more than 100 airports in 26 countries, and you will inevitably walk away grimacing or in shock at the magnitude of the fees when you conclude your foreign exchange transaction. Staff are on commission by the way, hence their often sheepish disposition.

One can only hope the Australian Taxation Office feels similarly offended when it receives the annual tax return from Travelex Australia Holdings. As the world’s largest retail foreign exchange specialist, and a provider of other financial services, Travelex moves a lot of money around.

And that is precisely what it has done here in its financial statements; somehow moving billions in revenue about the place and booking a tiny taxable income of $12 million. That’s a margin of just 0.23 per cent – a smidgeon of the 30 per cent fees Travelex routinely charges its customers.

Update: Travelex has responded to say that although the Tax Office numbers are correct, the total income number represents gross value of forex transactions.

“The three year total income of $5.3 billion is actually the value of all the currency which was bought and sold through Travelex, not the revenue we actually received from providing this service to our customers. This revenue was $535 million over the three years to 2015. The taxable income of $12.1 million therefore represents 2.3 per cent of revenue.

3 Yr. Total Income$5,335,790,513
3 Yr. Taxable Income$12,106,543
3 Yr. Taxable Income Margin0.23%
3 Yr. Tax Payable$3,429,912
3 Yr. Tax Rate28.33%
AuditorEY (Global)
IndustryFinancial Services
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METHODOLOGY

We are counting down the Top 40 Tax Dodgers. There are now three years of tax transparency data published by the Tax Office and we have used this data to work out which large companies operating in Australia have paid the least tax, or no tax.

Notable players such as Google, eBay, Booking.com, Expedia are not near the top of the ATO list. That's because they don't (yet) recognise income earned here; instead, they book Australian revenue directly to their associates offshore. They will be ranked in due course.

For other large corporations, and in particular, multinationals, the main steps in avoiding tax are made by reducing their taxable as much as they can; usually by sending it offshore in interest on loans, "service" fees or other payments to foreign associates. So, we have set a threshold. We have included only those companies which managed to wipe out 99.5 per cent or more of their taxable income over three years.

Qantas, therefore, is not on this list. Although it made $46 billion total income over the ATO's three years, it was able to reduce this by 99.4 per cent to $264 million, just missing our cut-off.

Taxable does not mean taxed. It paid zero.

The airline had made large losses which were offset against profits. Many large corporations which have paid zero tax in ATO data, have legitimately made losses and have therefore built up "tax-loss shelter".

Many others however, such as ExxonMobil and EnergyAustralia, are on the list as they managed to eliminate all or most of their taxable income by "debt-loading" or other means of aggressive tax avoidance.

In response to the censorship scandal which has engulfed the ABC in recent days as the government sought to muzzle its corporate tax coverage, the Tax Office put out a useful statement on its transparency data.

In this, the first iteration of michaelwest.com.au corporate tax rankings, we are going purely on the Tax Office data. We will also publish a list of Australia's better corporate taxpayers, those companies who contribute most to the country in which they operate.

The Tax Office data is by no means perfect. But sometimes we can identify patterns. In many cases, there are multiple entities with the same ultimate offshore parent reporting. One entity may pay zero tax, another may pay at the statutory 30 per cent rate (even if on low taxable income). We endeavour to be fair in our reporting to recognise these issues.

The data also recognises trusts as well as companies. For trusts, it is the members (investors) rather than the trust who are ordinarily required to pay the tax. In many cases however it is fair to recognise trust structures for what they are, as tax is often the main reason these vehicles have been structured as trusts.

Companies are welcome to debate their rankings or to touch base to clarify or defend their tax practices. We will append or link these submissions. UPDATED EXPLAINER.