When determining if the annual turnover of a business is $1 billion or less, for the purposes of working out whether the applicable decline in turnover threshold is 30% or 50%, it is the entity’s aggregated turnover that must be considered.

In this context, an entity’s ‘aggregated turnover’ is the same as what is used when determining if an entity is a small business entity (‘SBE’), which includes the annual turnover of an entity that is ‘connected with’ or an ‘affiliate’ of the entity. Broadly, an entity’s annual turnover is the total ordinary income derived by the entity in the ordinary course of carrying on a business, excluding dealings between the entity and its connected entities and affiliates.

Specifically, an entity will be subject to the higher decline in turnover threshold of 50% if the entity’s aggregated turnover is either:

• likely to exceed $1 billion for the current income year; or
• actually exceeded $1 billion in the previous income year

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