ATO BENCHMARKS, 2023-24
Expense and margin benchmarks for Australian painting businesses
By Ivanka Menken, Strategic Mentor·Last updated ·Figures from the Australian Taxation Office
In the ATO 2023-24 small business benchmarks, Australian painting businesses turning over more than $600,000 report total expenses of 74% to 86% of turnover. That leaves 14% to 26% of turnover before the owner, family members and tax are paid. The ATO open data does not publish a cost of sales ratio for this industry.
High turnover range, more than $600,000, turnover excluding GST
74% to 86%
Total expenses to turnover
ATO key benchmark range
14% to 26%
Left after total expenses
Before the owner, family members and tax are paid
What are the 2023-24 benchmarks for painting businesses?
The ATO splits each industry into turnover bands and publishes a range for each. The band closest to a business turning over $500,000 to $3,000,000 is the high turnover range: more than $600,000. The figures in the text on this page come from that band, and the table shows every band the ATO publishes for painting businesses.
A business turning over between $150,001 and $600,000 falls in the medium turnover range instead, and its figures are in the table too.
The ATO open data for this industry holds one ratio, total expenses to turnover, so this page works from that number. The ATO counts staff wages, rent, interest, depreciation and cost of sales inside total expenses, and leaves out payments to associated persons such as family members.
High band: more than $600,000
Closest to $500K to $3M
- Total expensesATO ratio
- 74% to 86%
- Left after total expensesCalculated: 100% less total expenses
- 14% to 26%
Low band: $50,000 to $150,000
- Total expensesATO ratio
- 36% to 51%
- Left after total expensesCalculated: 100% less total expenses
- 49% to 64%
Medium band: $150,001 to $600,000
- Total expensesATO ratio
- 54% to 71%
- Left after total expensesCalculated: 100% less total expenses
- 29% to 46%
| % of turnover | Low band$50,000 to $150,000 | Medium band$150,001 to $600,000 | High bandMore than $600,000Closest to $500K to $3M |
|---|---|---|---|
| Total expensesATO ratio | 36% to 51% | 54% to 71% | 74% to 86% |
| Left after total expensesCalculated: 100% less total expenses | 49% to 64% | 29% to 46% | 14% to 26% |
What do these figures mean for cash and payroll in painting businesses?
At the band’s ratios, a business turning over $1,000,000 would have $140,000 to $260,000 left after total expenses, about $2,690 to $5,000 a week. That pool has to cover your own pay, tax, loan repayments beyond the interest already counted, and any growth you fund yourself.
At the midpoint, painting businesses keep 20% of turnover after total expenses, 5.5 points above the median of 14.5% across the 96 industries on this site. A wider share gives growth more room, but only if the cash arrives before the bills do.
Size changes the picture. Businesses in the low band ($50,000 to $150,000) keep 49% to 64% of turnover; in the band closest to you it is 14% to 26%. Part of the reason is in how the ATO counts: wages paid to staff are an expense, while payments to associated persons are left out. A bigger business carries a bigger payroll, so each extra dollar of turnover arrives with more cost attached.
How much would a price rise change what painting businesses keep?
Ivanka Menken’s chain starts with price: prices too low, margins thin, growth eats cash, payroll becomes a monthly fear. As arithmetic only, if painting businesses in this band charged 5% more for the same work, with the same volume and the same costs, total expenses would fall to about 70% to 82% of turnover and the share left would rise from 14% to 26% to about 18% to 30%.
At the midpoint that is 20% becoming 23.8% of turnover, about 19% more left over from the same work. Whether your clients would accept the price is a separate question, and the one worth testing.
Where do painting businesses sit among Construction industries?
We grouped the ATO industries under their ANZSIC divisions so you can compare painting businesses with their neighbours. Of the 18 Construction industries on this site, painting businesses keep the 4th largest share of turnover after total expenses (tied), using each industry’s band closest to $500,000 to $3,000,000.
The grouping is ours, not the ATO’s; the ratios are the ATO’s. Neighbouring industries face similar costs, so a large gap to a close neighbour is worth a question about price or about the mix of work.
- Timber floor sanding31.5%
- Carpet laying services30.5%
- Bricklaying services23%
- Fence construction20%
- Painting services (this page)20%
- Electrical services19.5%
- Plumbing services19.5%
- Landscape construction19%
- Carpentry services18.5%
- Concreting services18.5%
- Fire and security alarm installation18.5%
- Cement rendering18%
- Glazing services17.5%
- Blocklaying services17%
- Air conditioning, refrigeration and heating services16%
- Floor and wall tiling services15.5%
- Roofing, roof tiling and guttering15.5%
- Plastering and ceiling services11.5%
How do you check your own numbers against these benchmarks?
Take last financial year’s turnover excluding GST, and total expenses less any payments to associated persons. Divide the second by the first and compare it with the 74% to 86% range above.
A benchmark tells you where you sit. It does not tell you why, or which decision to make next. Three free tools on this site turn the comparison into a monthly habit.
CHECK YOUR OWN NUMBERS
If you would like someone to read the numbers with you each fortnight, that is what Ivanka's 1:1 mentoring is for.
What else do founders ask about these figures?
What share of turnover do painting businesses spend on expenses?
In the ATO 2023-24 benchmarks, painting businesses turning over more than $600,000 report total expenses of 74% to 86% of turnover, leaving 14% to 26% before the owner, family members and tax are paid. Total expenses include staff wages, rent, interest and depreciation, and leave out payments to associated persons.
Which ATO turnover band applies to painting businesses turning over $1,000,000?
For painting businesses, the ATO 2023-24 bands are: low turnover range, $50,000 to $150,000; medium turnover range, $150,001 to $600,000; high turnover range, more than $600,000. A business turning over $1,000,000 sits in the high turnover range. Use last year’s turnover excluding GST to find yours.
Are the ATO figures before or after the owner’s pay?
Before most of it. The ATO subtracts payments to associated persons, such as family members, from total expenses, and a sole trader or partner does not pay themselves a wage at all. So the share left after total expenses is broadly what funds the owner, tax, loan repayments and growth. Your accountant can tell you how your own returns are set up.
What does it mean if my business is outside the range?
The ATO says a business outside the key benchmark range may have room to improve, and it uses the key benchmark to spot businesses that may not be reporting all their income. Each range covers the 30% of businesses around the industry average, so many legitimate businesses sit outside it. Check your figures with your accountant first.
Where do these figures come from?
Source: Australian Taxation Office, Small Business Benchmarks, 2023-24 data, published at https://data.gov.au/data/dataset/small-business-benchmarks and licensed under Creative Commons Attribution 2.5 Australia (CC BY 2.5 AU), https://creativecommons.org/licenses/by/2.5/au/. Ratios are reproduced as published; the margins, midpoints, dollar examples, groupings and comparisons are calculated by ivankamenken.com. The ATO does not endorse this page.
ATO industry name: Painting services. Division grouping (ANZSIC E, Construction) is ours. How the ATO calculates each ratio: https://www.ato.gov.au/businesses-and-organisations/income-deductions-and-concessions/small-business-benchmarks/small-business-benchmarks-methodology-and-ratio-calculations/how-we-calculate-benchmark-ratios
This page compares published figures. It is not financial or tax advice; your accountant does the accounts. See every industry →