Industry benchmarks are ratios calculated from information provided to us on tax returns and activity statements. Presented as financial and activity statement ratios, they can be used to:
- analyse business activity and performance
- identify businesses who vary significantly from industry averages.
We produce separate benchmarks for individuals, companies, partnerships and trusts. We also produce a set of benchmarks that combines data for individuals, companies, partnerships and trusts together.
Two sets of ratios – one for all entities and another only for profitable entities – are produced for each of the three levels of industry:
- broad industry
- fine industry
- business industry code.
The industry grouping is based on the industry codes provided on tax returns.
Some tables are further divided by business status (newly commenced business or established business) while others are broken down by ranges of business income.
For each sub-population, we show the:
- number of entities
- average ratio
- median ratio.
Along with the industry benchmarks, we also produce small business benchmarks for selected industries. These benchmarks are slightly different and are for businesses whose turnover is up to $15 million.
Financial ratios
The financial ratios industry benchmarks use data from tax returns to calculate the following ratios.
Net profit ratio = (Total business income − Total expenses) ÷ Total business income
Gross profit ratio = (Total business income − Cost of sales) ÷ Total business income
Wage to turnover ratio = Salary and wages paid ÷ Total business income
Expense to turnover ratio = Total expenses ÷ Total business income
Activity statement ratios
The activity statement ratios industry benchmarks use data from business activity statements to calculate the following ratios.
Net GST to sales ratio = (GST on sales − GST on purchases) ÷ Total sales
Wages to sales ratio = Total salary and wages ÷ Total sales
Caution when using industry benchmarks
These benchmarks are not definitive and should not be used in isolation.
As an example, there are a range of legitimate reasons why businesses' ratios may vary from the industry averages and, conversely, why businesses' ratios close to the industry averages may have compliance problems or other financial difficulties.
A ratio calculated using a large population is generally more reliable than one calculated from a small population. In any population being analysed, there are times when misleading results can be produced. For example, when:
- amounts listed at tax return labels appear to be an error, or do not make sense, like when cost of sales or total expenses are zero
- businesses are too small, like when total income is less than $10,000
- the ratios for a single entity are exceptional and would distort the calculation of an industry average.
In our calculations we exclude records like these to stop them having an unwanted impact on our ratios. For more information on why we exclude some data from the calculation, refer to table 1 below.
Industry benchmarks detailed tables
Table 1External Link: How we calculate our industry benchmarks
Financial ratios
Table F1External Link: Individual financial ratios, for the 2018–19 income year
Table F2External Link: Company financial ratios, for the 2018–19 income year
Table F3External Link: Partnerships financial ratios, for the 2018–19 income year
Table F4External Link: Trusts financial ratios, for the 2018–19 income year
Table F5External Link: All entities financial ratios, for the 2018–19 income year
Activity statement ratios
Table A1External Link: Individual activity statement ratios, for the 2019–20 financial year
Table A2External Link: Company activity statement ratios, for the 2019–20 financial year
Table A3External Link: Partnership activity statement ratios, for the 2019–20 financial year
Table A4External Link: Trust activity statement ratios, for the 2019–20 financial year
Table A5External Link: All entities activity statement ratios, for the 2019–20 financial year.
See also: