Apple has reported a massive decline in its Australian post-tax profit for the 2016 financial year, after paying a hefty tax adjustment relating to previous years.
The iPhone maker’s consolidated Australian revenue fell slightly by three percent, or $296 million, to hit $7.5 billion for the 12 months to 24 September 2016, according to its annual report to corporate regulator ASIC.
The result marks a return to declining local revenue for a company whose success is tied directly to the launch cycle of its most popular product, the iPhone.
Apple posted a positive performance in 2015 when sales surged $1.7 billion, or 27.9 percent, to $7.9 billion for the 12 months to 25 September 2015. The company had experienced a flat 2014, when annual revenue was down 0.5 percent to $6.07 billion compared with the same period in 2013.
The most dramatic figure for FY2016, however, was yearly profit, which crashed $119 million, or 97 percent, to $3.6 million.
That figure is the result of a massive increase in the company’s reported tax expense: the Australian wing of Apple paid $128 million in tax for the years.
The figures includes $69.8 million related to FY2016, and an adjustment of $58.3 million relating to prior years.
The bottom line wasn't the only casualty: Apple's FY2016 pre-tax profit was also down $76 million, or 36 percent.
Apple Australia’s tax bill has experienced a great deal of fluctuation in the past three years. In the 2015 financial year Apple also paid a tax adjustment of $11 million to total $84.9 million.
In 2014 Apple paid $80.3 million in tax, more than double than its 2013 tax bill of $36.4 million, though 2014’s taxable income was $163 million greater than the year prior.
It is not clear which years Apple’s FY2016 tax adjustment accounts for, or how exactly it was calculated. The ATO is currently auditing the company's 2012 results. Apple Australia was contacted for comment.
The Australian government last year announced it was cracking down on multinational company tax accounts, following its scrutiny on the likes of Apple, Microsoft and Google shifting profits overseas.
The 2016 budget introduced a diverted profits tax, which would impose a 40 percent penalty rate on large multinationals trying to shift their profits offshore.
In August last year, Apple was ordered by repay €13 billion (A$19.2 billion) taxes after the European Commission found its Irish tax structure "illegal under EU state aid rules".