Manchester City have dropped far behind Manchester United in terms of overall wage bill, the club’s annual report shows. City, who once had the largest Premier League salary costs. had a wage bill of £196m, putting them on a par with Arsenal and below United’s figure of £232m for 2015/16 and Chelsea’s £215m for the previous season.

Wages amounted to 50 per cent of turnover, the figure recommended by accountants Deloitte. Three years ago City were penalised by Uefa for breaching financial fair play rules.

Manchester City have dropped far behind Manchester United in terms of overall wage bill, the club’s annual report shows. City, who once had the largest Premier League salary costs. had a wage bill of £196m, putting them on a par with Arsenal and below United’s figure of £232m for 2015/16 and Chelsea’s £215m for the previous season.

Wages amounted to 50 per cent of turnover, the figure recommended by accountants Deloitte. Three years ago City were penalised by Uefa for breaching financial fair play rules.

Turnover was a record £392m, the second higest in the Premier League after Manchester United. They made a profit for the second consecutive year, £20.5m. This comes just five years after they announced the biggest ever loss recorded by any club in English football history, £197m in 2010-11.

Having expanded the stadium, average Premier League attendances increased by more than 8,000 to 54,041. This helped to increase total income from matches last season by 21 per cent to £52.5m. Television income was up by 19 per cent to £161.4m.

Commercial income was up slightly by 3 per cent to £177.9m. This relatively small increase is understood to be the consequence of major commercial deals being spread across the other football clubs that Sheikh Mansour owns under the City group: New York City and Melbourne City.