Sir Richard Branson’s Virgin Care Services Ltd has defended itself against reports it paid no corporation tax despite making an £8 million profit from running services for the NHS.

The company — whose rapid growth was in part attributed to it securing a seven-year contract worth £126 million by NHS Dartford, Gravesham and Swanley Clinical Commissioning Group (CCG) and NHS Swale CCG in 2016 — turned over £200m last year.

Profits increased from £7.28m to £8.16m and staff numbers ballooned from 218 to 1,190.

The north Kent deal was one of three large contracts awarded to Virgin by the NHS which started in the 2016/17 financial year.

But despite this the company paid no tax because its parent company Virgin Care lost £19.3m, the i reports.

Speaking to Kent Online's sister paper the Gravesend Messenger a spokesman for Virgin Care said it was misleading to say it had profited from delivering health care as Virgin Care Services is just one part of its organisation.

He said the running of services — including those at Gravesham Community Hospital, Gravesend; Livingstone Community Hospital, Dartford; Sittingbourne Memorial Hospital; and Sheppey Hospital — is dependent on various other companies under the Virgin Care umbrella which did not perform as well.

The north Kent contract was awarded in January 2016 at the expense of previous provider Kent Community Health NHS Trust Foundation Trust and Virgin took over in September of that year.

It now delivers all services which aren’t available at large hospitals or doctor’s surgeries in those areas, such as speech therapy and rehabilitation.

Virgin Care can be traced back through a number of parent companies to Virgin Group Holdings Ltd, based in the British Virgin Islands, a tax haven.

Virgin now operates more than 400 NHS contracts and treats one million people every year and was awarded a record £1 billion worth of contracts in 2017 alone.

Last year £3.1bn of services were out sourced, an increase of £700m on the previous year, with 70% of contracts won by private companies despite the government issuing repeat assurances that for-profit companies had a minimal role to play in the health service.

Virgin Care hit the headlines in November when it sued six CCGs, which paid the company an undisclosed sum, after becoming concerned over “serious flaws” in the procurement process.

A spokesman for Virgin Care said: "We have not yet reached a state of profitability overall, and our shareholders are still investing in the growth of the business.

"Virgin Care is incorporated and resident in the UK for tax purposes and so, as and when we reach profitability, we will meet our obligations just as we do today.

"We’re focused on delivering the improvements we have been commissioned to deliver, providing high quality joined-up services to the communities we serve.”