The near decade-long run of Qantas not paying corporate tax is over.
Within the detail of a record profit announced today was a note saying Qantas has exhausted the last of its available carry forward tax losses.
Qantas today announced a full year 14% lift in underlying profit before tax to a record $1.6 billion. Staff shared $67 million in bonuses and shareholder got $500 million.
Analysis in February this year showed the national airline hadn’t paid corporate tax since 2009.
The tax losses started for Qantas with the GFC, followed by a union dispute and a massive loss of $2.8 billion in 2013.
Under the Australian taxation system, companies can accumulate and carry forward any losses to be offset by future profits.
S&P Global Ratings says the record earnings announced today will enable the airline to withstand higher fuel prices and resume tax payments.
“In our view, Qantas’ strong earnings should provide the company with a buffer to withstand higher fuel prices and the resumption of company tax payments,” the ratings agency says.
“The airline’s tax losses carried forward have been fully exhausted and the company will resume paying tax installments in February 2019.
“The level of taxable income has been volatile over the past few years, making it difficult to forecast.”
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