Quick answer
Turnover is the total income a business earns from its ordinary trading, such as sales of goods and services, before any costs are taken out. In Australia it's normally quoted excluding GST. It isn't profit: a business can turn over $2 million and still make a loss. The ATO uses turnover to set GST and small business thresholds, and lenders use it to size and qualify loans.
Key points
- Turnover is gross sales income, not profit, and is usually quoted ex-GST
- GST registration is required once GST turnover reaches $75k
- Most ATO small business concessions need aggregated turnover under $10m
- Lenders use turnover to qualify and size loans, and profit to test repayments
Turnover is the money flowing in the front door from what your business sells, before rent, wages, stock or tax are paid. If a florist sells $640k of arrangements and deliveries in a year, that’s its turnover, whatever is left at the end.
The word gets used loosely, and the context matters. An accountant, the ATO and a lender can each mean something slightly different by it. (In HR, “staff turnover” means the rate people leave a business, which is a different idea entirely.)
Turnover, revenue and profit: what’s the difference?
| Term | What it measures | Florist example |
|---|---|---|
| Turnover | Income from normal trading, ex-GST | $640k |
| Gross profit | Turnover minus direct costs (flowers, packaging, delivery fuel) | $352k |
| Net profit | What’s left after every expense, including wages and rent | $58k |
Turnover tells a lender how big and active the business is. Profit tells it whether the business can afford repayments. Both matter, but they answer different questions.
Where the ATO uses turnover
Several tax rules hinge on turnover, which is one reason the figure shows up on so many forms:
- GST registration. Once GST turnover hits $75k, registration becomes compulsory (or $150k for non-profits). It tests this two ways: the current month plus the previous 11 months, and the current month plus the next 11 months. Registration is due within 21 days of crossing the line.
- Small business entity status. Most small business tax concessions need an aggregated turnover under $10m. The ATO sets lower limits for some: $5m for the small business income tax offset and $2m for the small business CGT concessions.
- Aggregation. That “aggregated” word is important. It adds in the turnover of connected entities and affiliates, so a group running three related companies is tested on the combined figure.
None of these thresholds decides whether you can borrow, but they do explain why your BAS and tax return show the numbers they do.
How lenders use your turnover
Lenders look at turnover in two ways. First as a gate: plenty of unsecured products have a minimum turnover, checked against recent bank statements or BAS. Second as a sizing tool: an unsecured business loan limit is commonly a slice of monthly or yearly sales, because steady deposits are the lender’s main comfort.
Property-secured lending is different. With equity in real estate behind the loan, some lenders will consider a business whose turnover is modest, seasonal or recently dipped. Our page on business loans for low-turnover businesses covers those options.
Not sure whether your sales figures will clear a lender’s bar? Run them past us; it costs nothing to ask.
Worked example: same turnover, different answers
Two Adelaide businesses each turn over $1.2m a year, excluding GST.
A wholesale coffee roaster works on thin margins and nets $48k. A physiotherapy clinic, with lower direct costs, nets $210k. Both easily clear a fintech lender’s turnover minimum, and both might be offered a similar unsecured limit on turnover alone. But when the lender checks serviceability, the clinic can comfortably carry far larger repayments. The roaster may do better with a smaller loan, a longer term, or security that brings the cost down.
For precise reporting periods and how to calculate the yearly figure from BAS, see annual turnover. To get a feel for what your sales and profit could support, try the business borrowing power calculator.
Your turnover tells a story; let’s put it to work
Whether your sales are climbing, steady or bumpy, the right lender will read them in context. Finding out starts with a brief enquiry: about sixty seconds of your time, with no credit search attached to it. We keep your information in-house instead of firing it off to lenders far and wide, and a team member looks at your numbers before giving you a call. Enter your genuine annual turnover, ex-GST if you can, so the options we raise are ones you’ll actually qualify for.
Frequently asked questions
Is turnover the same as revenue?
In everyday Australian business talk, yes, the two are used interchangeably. Accountants sometimes separate them: revenue can include interest, rent or one-off gains, while turnover usually means income from your normal trading activity. Lenders mostly care about trading income.
Is turnover the same as profit?
No. Turnover is what comes in before costs. Gross profit is turnover minus the direct cost of what you sold, and net profit is what's left after all expenses. A high-turnover, low-margin business can earn less than a smaller business with healthy margins.
Should I include GST in my turnover figure?
Normally not. The ATO's thresholds exclude GST, and most lenders expect a GST-exclusive figure. If you quote a GST-inclusive number, say so, because it'll look about 10% higher than your bank statements once the lender strips out GST.
What turnover do I need for a business loan?
It varies by lender and product. Unsecured and fintech lenders often set a monthly or annual minimum, while property-secured lenders may care far less about turnover because the security carries more of the weight.
What is aggregated turnover?
An ATO concept: your own annual turnover plus the turnover of entities connected with you or that are your affiliates. It's used to test eligibility for small business tax concessions, so a group of related businesses can't split up to stay under a threshold.