• ## Reference material

This reference material is designed to help you get the most out of our statistics.

### Definitions and calculations

#### Entity size

For the purposes of our yearly Taxation statistics, an Entity is an individual, a company, a fund, a self-managed fund, a partnership or a trust.

An entity’s size is determined by referring to Table 21 as follows.

Table 21: Determine entity size

Entity size

Loss

less than \$0

Nil

equal to \$0

Micro

\$1 to less than \$2 million

Small

\$2 million to less than \$10 million

Medium

\$10 million to less than \$100 million

Large

\$100 million to less than \$250 million

Very large

\$250 million or more

Total business income is the amount:

• an individual showed under item P8 Business income and expenses at the total business income label of the 2016 individual tax return
• a company showed in the information statement under the income item at the total income label S of the 2016 company tax return
• a fund showed at item 10 under the income item at the total assessable income label V of the 2016 fund income tax return
• a self-managed super fund showed at item 11 under the income item at the total assessable income label V of the 2016 SMSF annual return
• a partnership or trust showed at item 5 under the income item at the total business income label of the 2016 partnership or trust tax return.

#### Calculating net tax

Throughout these taxation statistics, 'net tax' is essentially the amount of tax owed for the income year, before refundable credits are taken into consideration. It does not generally equate to the amount of tax payable or refundable as shown on a notice of assessment.

Items in brackets below refer to tax return labels.

A taxable entity is one where net tax is more than \$0, whereas non-taxable entities are those with net tax less than or equal to \$0.

##### Individual net tax

Individual net tax is calculated as:

 Total income or loss less Total deductions less Tax losses of earlier income years gives Taxable income or loss apply Individual marginal tax rates gives Tax on taxable income add Extra income tax subtract Total non-refundable tax offsets add Medicare levy add Medicare levy surcharge add Temporary budget repair levy subtract Remaining foreign income tax offset gives Net tax
Notes:Extra income tax: an example of this is the amount added to tax on taxable income when a primary producer’s average income exceeds taxable income in a particular year.Remaining foreign income tax offset: this is a non-refundable tax offset so can only be applied to reduce any liability to nil (that is, cannot result in a refund).
##### Company net tax

Company net tax is calculated as:

 Total income (item 6S) less Total expenses (item 6Q) gives Total profit or loss (item 6T) add or subtract Reconciliation items (item 7) gives Taxable income (calculation statement – item A) apply Relevant company tax rate add R&D recoupment tax (calculation statement – item M) gives Gross tax (calculation statement – item B) subtract Non-refundable tax offsets and Franking deficit tax offset (calculation statement – items C, D and F) gives Net tax
##### Super fund net tax

Super fund net tax (for APRA and SMSFs respectively) is calculated as:

 Total assessable income (item 10V/11V) less Total deductions (item 11N/12N) gives Taxable income or loss (item 11O/12O) apply Fund type specific tax rate add Tax on no-TFN quoted contributions (item 12J/13J) gives Gross tax (item 12B/13B) subtract Non-refundable non-carry forward tax offsets (item 12C/13C) gives Net tax

#### Estimating tax on net capital gains

For taxation statistics purposes, the tax on net capital gains is an estimate of the tax required to be paid, based on using an average tax rate approach.

Tax on net capital gains is estimated as:

 Net tax divided by Taxable income gives Average tax rate multiplied by Net capital gain gives Estimated tax on net capital gains

For taxation statistics purposes, business net tax is an estimate of the amount of net tax attributable to net business income. Business net tax is only calculated for taxable individuals with net business income and taxable income.

Business net tax is estimated as:

 Net income or loss from business (sum of items 15B and 15C) divided by Taxable income (label \$ under the Losses section) gives Proportion of taxable income sourced from net business income multiplied by Net tax gives Estimated business net tax
Note: Where the proportion calculated above is greater than 1, it is changed to 1.

#### Calculating net GST

Net GST is calculated as:

 Gross GST payable add Deferred GST payments on imports less Input tax credits gives Net GST
Note: The net amount of GST on the activity statement can also be affected by increasing and decreasing adjustments.

### Tax return forms and other relevant publications

All the tax return forms, associated instructions and guides and other publications referred to in this Taxation statistics report are listed here.

### Data cut-off dates and abbreviations

#### Data cut-off dates

The data in our tables includes data processed up to 31 October of the following year. For example, data for the 2015–16 income year includes data processed up to 31 October 2017.

The statistics are sourced from annual tax returns (including amended returns), associated schedules (such as the capital gains tax schedule) and activity statements that were processed up to 31 October 2017.

Statistics in the detailed tables have been updated for the 2013–14 to 2015–16 income years and 2014–15 to 2016–17 financial and FBT years, to include returns processed up to 31 October 2017. These statistics are not necessarily complete and will continue to change as more tax returns and schedules are lodged and processed.

Data for the 2012–13 and earlier income years and 2013–14 and earlier financial and FBT years, have not been updated in this edition.

#### Abbreviations

Table 22: Abbreviations used in Taxation statistics

Abbreviation

Full title

APRA

Australian Prudential Regulation Authority

ATO

Australian Taxation Office

CGT

Capital gains tax

FBT

Fringe benefits tax

GST

Goods and services tax

LCT

Luxury car tax

MCS

Member contributions statement

PRRT

Petroleum resource rent tax

SMSF

Self-managed super fund

WET

Wine equalisation tax

Table 23: Abbreviations used within tables

Abbreviation

Description

no.

number

\$m

dollars are shown in millions

na

not applicable or not available

<1

rounded to zero but not zero