ENERGY giant npower has rejected fresh claims that it is avoiding its tax obligations in the UK following a report that it has shifted millions in profit to Malta.

The company, which has its headquarters in Blackpole, Worcester, admitted earlier this month that it has not paid corporation tax in the UK for three years, arguing that it has invested "billions" in new power stations and wind technology.

But a national newspaper report yesterday claimed that it has avoided paying up to £108 million in UK corporation tax in the past four years with the use of a Maltese company called Scaris.

The report claims that more than half of the firm's funding comes from German owner RWE via loans paid through Scaris, a shell company based in the Mediterranean tax haven, allowing npower to return annual interest on the loans.

It claims the arrangement means the UK gas and electricity supplier can post a loss here, and avoid corporation tax.

A spokesman for RWE npower confirmed it worked with the Malta company "for a couple of years" until 2011, adding: "I can categorically state that this makes no difference to our UK tax situation."

He added: "All of the ways in which we manage our tax is approved by HMRC.

"I can confirm that all of our UK activity is taxed in the UK and we pay all the taxes due.

"The reason it has been modest in the last few years is that we have invested around £5 billion in the UK."

Earlier this month the firm’s chief executive Paul Massara told the Commons Energy and Climate Change Select Committee that the company had not paid corporation tax for three years.

Mr Massara said: ''Effectively we have invested £5 billion in the last five years building power plants, creating jobs, creating employment and helping to keep the lights on.

"If we had not made that investment we would not have the deductibility that we would be allowed. That is a simple accounting UK rule.''

npower increased gas prices by 8.8% and electricity by 9.1% in November. The company reported a 34% rise in profits to £413 million last year.

David Babbs, the executive director of lobby group 38 Degrees, said: "npower need to stop wriggling and accept that they've been caught dodging tax. Most people think this is unacceptable. “If they want to keep their customers in the UK, they need to start paying their fair share of tax here in the UK, and prove it by putting full accounts for their UK operation for 2012 on public record."