Glossary
ATO small business benchmarks
The ATO's industry-by-industry ranges for costs and margins, built from real tax returns. A free, independent sanity check on any business's numbers.
In plain English
The ATO compiles financial ranges for over a hundred industries from the tax returns actually lodged in each: cost of sales as a share of turnover, labour as a share of turnover, expected margins. The tax office uses them to spot returns that look wrong for their industry.
For buyers and borrowers they are something better: a free, genuinely independent reference for whether a business's numbers are plausible. A cafe claiming cost of goods far below the benchmark range is either exceptional or misdescribed, and the difference is worth finding before you pay for it.
Why a lender cares
Benchmark comparison answers the assessor's quiet question: are these numbers normal for this kind of business? Forecasts anchored to benchmark ranges read as evidence; forecasts floating free of them read as hope. Our models and business plans carry a benchmark comparison as a standard section, against the ATO's own figures.
Sources: ATO: Small business benchmarks
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