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Hot Topic Hawke’s Bay
Hot Topic Hawke’s Bay
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Apple NZ boosts 2015 earnings while deferring $8.3m in tax against future profits

Profit was $17.7 million for the year ended September 26, 2015.

Fiona Rotherham
Tue, 09 Feb 2016

Apple Sales New Zealand, the local unit of the iPhone and iPad maker, has increased annual profit by 17%  while deferring $8.3 million of tax to offset against future profits and potentially lower its 2016 tax bill.

Profit was $17.7 million for the year ended September 26, 2015, up from $15.1 million a year earlier, according to financial statements lodged with the Companies Office. Revenue rose 29%  to $732 million. Of that, sales of goods rose to $720 million from $557 million the previous year while service fee income dipped slightly to $11.5 million.

The local unit of the world's biggest company by market value paid $8.9 million in tax, up from $6.8 million in the 2014 financial year. The accounts say the initial tax expense of $10 million was whittled down by $2.2 million in deferred taxes but bumped up by $1 million in adjustment for tax paid in previous years.

Notes to the accounts say there are certain transactions and computations for which the ultimate tax determination is subject to the agreement by the relevant tax authority and the company recognises liabilities for such transactions based on estimates of whether additional taxes will be due. The carrying amount of its tax payables and deferred tax assets as at September 26 were $10 million and $10.5 million respectively.

Apple is one of a number of high-profile multinational companies that have been criticised for minimising tax by routing profits through offshore subsidiaries and the Australian media last month questioned why it was paying only $A85 million in tax on $A8 billion of revenue in that country in the 2015 financial year. Its Australian unit also had $A200 million of deferred tax assets that could mean it will pay virtually no tax on next year's profits.

Apple Sales New Zealand said it won't be paying a dividend to its parent this year after forking out $15 million a year earlier and $14.8 million in 2013 after a two-year hiatus.

Related party transactions included its biggest cost – purchase of inventory at $791 million, up from $534 million in 2014.

(BusinessDesk)

Fiona Rotherham
Tue, 09 Feb 2016
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Apple NZ boosts 2015 earnings while deferring $8.3m in tax against future profits
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