• Privately owned and wealthy groups demographics

    In our approach to tax assurance activities, we segment privately owned and wealthy groups into three populations. There are:

    • 156,582 private groups  
      • economic groups with an annual turnover of greater than $2 million that are not public groups or foreign-owned
       
    • 128,005 wealthy Australians (WA)  
      • Australian-resident individuals who, together with their associates (often including small business enterprises), effectively control an estimated net wealth of between $5 million and $30 million
       
    • 4,586 high wealth individuals (HWI)  
      • Australian-resident individuals who, together with their associates, effectively control an estimated net wealth of $30 million or more.
       

    Note that these populations are not mutually exclusive – some associated entities belong to more than one population: 

     
     
     Diagram showing the overlap of the high-wealth individuals, wealthy Australian and private groups population segments described above. Of the 156,582 private groups: 35.8% of private groups have links to wealthy Australians, 8.0% of private groups have links to high-wealth individuals.

     

     

     

    This data was current at September 2015 and is based on data for the 2013–14 financial year.

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    Key points

    Privately owned and wealthy groups are diverse in terms of size, operating structure and industry.

    While the majority (98%) of private groups have turnovers of less than $50 million, there are more than 160 large privately owned and wealthy groups with an annual turnover in excess of $1 billion or who control net assets of more than $500 million.

    The majority of private groups have up to five entities in their group. HWIs tend to control larger, more complex groups: 379 HWIs have groups of more than 50 entities. Most of the entities within this segment are private companies; trusts are the second most common entity type.

    The most common industry in this segment is finance, followed by construction and retail.

    Tax revenue

    Taxpayers in this segment are registered for a range of tax obligations, including income tax, goods and services tax (GST) and pay as you go withholding (PAYGW).

     Privately owned and wealthy groups - tax revenue reported for 2013–14

     

    HWI

    WA

    Private groups

    Total

    Net income tax payable

     

    – Individuals

    $ 3.44 b

    $ 16.98 b

    $ 0.25 b

    $ 20.67 b

    – Companies

    $ 5.34 b

    $ 9.47 b

    $ 4.16 b

    $ 18.97 b

    – Super funds

    $ 0.05 b

    $ 0.38 b

    $ 0.03 b

    $ 0.46 b

    – Trusts

    $ 0.07 b

    $ 0.27 b

    $ 0.09 b

    $ 0.43 b

    Total net income tax

    $ 8.90 b

    $ 27.10 b

    $ 4.52 b

    $ 40.53 b

     

     

     

     

     

    Net GST

    $ 3.78 b

    $ 10.63 b

    $ 8.08 b

    $ 22.49 b

    PAYGW

    $ 6.31 b

    $ 17.60 b

    $ 17.95 b

    $ 41.86 b

    FBT

    $ 0.19 b

    $ 0.33 b

    $ 0.26 b

    $ 0.77 b

    Note: The above table reflects mutually exclusive revenue for privately owned and wealthy groups. Tax revenue reported for private groups does not include revenue already accounted for in the HWI and WA figures.

    Populations in detail

    Privately owned and wealthy groups populations

     

    Pie chart. The data for this diagram is in the table below.


    Privately owned and wealthy groups populations

    Population

    Groups

    Active entities

    All entities

    HWI

    4,586

    62,675

    93,401

    WA

    128,005

    699,242

    926,704

    Private groups

    156,582

    213,631

    233,302

    Total

    289,173

    975,548

    1,253,407

    Note: Active income tax entities are entities that have lodged recent income tax returns, and exclude entities that are classified as inactive for reasons such as ceased business, no income tax role, or further return not necessary. 

    Location

    The head entities of most privately owned and wealthy groups (79%) are located in New South Wales, Victoria and Queensland.

    Group head location

    State

    HWI

    WA

    Private groups

    NSW

    1,621

    46,337

    50,819

    VIC

    1,361

    36,692

    40,081

    QLD

    708

    21,423

    29,420

    WA

    551

    13,795

    19,855

    SA

    198

    5,901

    10,070

    TAS

    56

    1,881

    2,447

    ACT

    61

    1,510

    2,491

    NT

    30

    462

    1,399

    Unknown

    0

    4

    0

    Total

    4,586

    128,005

    156,582

    Combined location proportions

     

    Graphic representation of the locations of the heads of privately owned and wealthy groups, based on the data in the preceding table.


    Entity types

    Privately owned and wealthy groups use a range of different legal structures. The most common entity types are private companies and trusts, which account for 60% of all entities:

    • the most common trust types utilised are discretionary investment trusts and fixed unit trusts
    • almost all of the funds linked to privately owned and wealthy groups are self-managed funds.
    Entity types

    Entity type

    HWI

    WA

    Private groups

    Company

    24,968

    168,026

    126,636

    Trust

    22,762

    178,177

    60,964

    Individual

    7,968

    226,348

    4,213

    Partnership

    3,271

    39,880

    12,336

    Superannuation funds

    3,706

    86,811

    9,482

    Total

    62,675

    699,242

    213,631

    Group income

    The income reported by groups and single entities within this segment varies greatly. The majority (89%) of groups report an annual income of $10 million or less. There are 504 groups with an annual income of between $250 million and $1 billion, and 63 groups with an annual income of more than $1 billion.

    There is a larger proportion of HWI groups with income ranges greater than $10 million. In contrast most WA and private groups have income ranges of $10 million or less.

    Group income

    Income range

    HWI

    WA

    Private groups

    <$10m

    2,170

    116,573

    137,426

    $10m–$50m

    1,382

    10,013

    16,422

    $50m–$100m

    435

    1,016

    1,570

    $100m–$250m

    420

    349

    830

    $250m–$500m

    115

    39

    210

    $500m–$1b

    51

    8

    81

    >$1b

    13

    7

    43

    Total

    4,586

    128,005

    156,582

    Group sizes

    The privately owned and wealthy group population is diverse in terms of group size, ranging from single entity groups to large complex groups:

    • HWIs control larger and more complex groups, with 61% of HWI groups comprising more than 10 entities
    • WA groups are smaller in comparison to HWI groups – only 15% have more than 10 entities
    • the majority (84%) of private groups are single-entity groups - however 1,206 groups have more than 10 entities.
    Group sizes

    Group size

    HWI

    WA

    Private groups

    1

    166

    5,431

    131,778

    2–5

    549

    60,087

    21,194

    6–10

    1,054

    43,319

    2,404

    11–20

    1,306

    15,501

    802

    >20

    1,511

    3,667

    404

    Total

    4,586

    128,005

    156,582

    Industries

    Finance is the most common industry found in privately owned and wealthy groups and includes financial asset investors, the financial services sector, insurance services and holding companies.

    Rental and hiring services is the second most common industry among HWI and WA groups. This may be attributable to the property asset portfolios of wealthy individuals.

    Other common industries for the privately owned and wealthy group population are construction, retail, professional services, wholesale and manufacturing.

    Among members of the WA population, agriculture and health also appear as top industries.

    Key industries in the privately owned and wealthy groups segment

    Industry

    HWI

    WA

    Private groups

    Finance

    1,169

    27,837

    23,288

    Construction

    576

    10,355

    21,479

    Retail

    234

    6,496

    19,988

    Rental/Hiring/Real estate

    778

    17,422

    7,902

    Professional/Scientific

    191

    11,240

    12,459

    Wholesale

    240

    6,118

    12,706

    Manufacturing

    274

    5,464

    11,514

    Agriculture

    237

    10,130

    6,787

    Health care

    80

    8,452

    4,445

    Remaining

    807

    24,491

    36,014

    Total

    4,586

    128,005

    156,582

    Top industries (by group numbers)

    Column chart showing the most represented industries among HWI, WA and private groups.


    Tax agents

    The majority (97%) of privately owned and wealthy groups are represented by a registered tax agent, with:

    • 76% of HWI groups represented by more than one agent
    • this proportion drops to 51% for WA groups
    • the majority of private groups (94%) represented by only one agent – this is attributable to the large proportion of single entity groups among the private groups.

    Number of tax agents representing groups

     
     Stacked column chart showing the number of tax agents engaged by different types of groups.E

     


    Age

    HWI group heads tend to be slightly older than wealthy Australians – 34% of HWIs are older than 70 years, compared to 23% of WAs.

    Age of group head

    Graph. The data for this diagram is in the table below.

     
     

     

    Age of group head

    Age range

    HWI

    WA

    <40

    99

    6,873

    41–50

    457

    21,355

    51–60

    1,017

    33,519

    61–70

    1,461

    36,198

    >70

    1,550

    30,045

    Unknown

    2

    15

    Total

    4,586

    128,005

    More information

    To get more comprehensive demographics information in future updates, you can contact us at: TransparencyPGH@ato.gov.au

    See also:

    Last modified: 10 Mar 2016QC 44822