How is the $2 million aggregated turnover test calculated for the CGT Small Business Concessions?

Section 152-10 (1AA) of the Income Tax Assessment Act 1997 states – you will be a Small Business Entity if your turnover is less than $2,000,000.  

Section 328.110 ITAA 1997, details how the turnover is calculated and the ATO website has a useful summary:

https://www.ato.gov.au/forms-and-instructions/advanced-guide-to-cgt-concessions-for-small-business-2008/basic-conditions-for-the-small-business-cgt-concessions/small-business-entity/how-to-work-out-your-aggregated-turnover

Amounts to include:

 - sales of trading stock

- fees for services provided

- interest from business bank accounts

- amounts received to replace something that would have had the character of business income, for example, a payment for loss of earnings

Amounts not to include:

- GST you have charged on a transaction

- amounts borrowed for the business

- proceeds from the sale of business capital assets

- insurance proceeds for the loss or destruction of a business asset

- amounts received from repayments of farm management deposits

McNamara & Company - Chartered Accountants, located minutes from the Melbourne CBD
www.mcnamaraandco.au/contact-us
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Email admin@mcnamaraandco.au

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