012-073 - ATO Small Business Benchmarks

The Australian Taxation Office (ATO) produces benchmarking tables for particular industries compiled over a period of several years from income tax returns lodged and some industry participation.

The ATO has stated that these benchmarks provide a snapshot of what, on average, is happening in businesses operating in a particular industry by providing a measure of various business costs in relation to turnover in regional areas and capital cities. These tools have two purposes:

• To provide taxpayers with a useful, independent tool to assess their business performance; and
• To help the ATO and tax agents to identify business that may be avoiding their tax obligations.

This paper is discussed under the following headings:

• Australian Taxation Office Small Business Benchmarks - Introduction
• Types Of Benchmarks
• How The ATO Uses Benchmarks
• How To Calculate The Ratios For Performance Benchmarks
• Input Benchmark Guide
• Industry Types
• When The Business Is Outside The Benchmark
• Summary