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Small Business Identification tool

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The SBI tool reduces the compliance burden for reporting entities. It assists reporting entities to identify which suppliers they need to report on.

For the purposes of the scheme, a business is small if it is identified as such through the SBI tool. The tool identifies businesses as small businesses if they carry on an enterprise in Australia, have an ABN and their annual turnover was less than $10 million for the most recent income year.

Reporting entities can access the SBI tool through a reporting portal.

To use the SBI tool, a reporting entity should first collate a list of their supplier ABNs. As entities are not required to report on payments to members of their controlling corporation’s group, the entity should remove the ABNs of these businesses. This includes small businesses that are subsidiaries of the group.

The reporting entity can then upload a CSV file of its supplier ABNs to the SBI tool. The SBI tool will return a CSV file listing the relevant ABNs. These ABNs are small businesses for the purposes of their Payment times report.

The SBI tool only contains the ABNs of large and medium sized businesses. It does not include any information on small businesses. The SBI tool works as a ‘negative screen’ for small businesses. ABNs uploaded are matched against the database, and any ABNs that do not have a match are assumed to be small businesses. The SBI tool returns a list of ABNs that excludes the identified large and medium sized businesses within a reporting entity’s list of supplier ABNs. 

When to run the SBI tool

A reporting entity must run an extract from the SBI tool at the end of the reporting period during the 3-month reporting window.

Payments to the small business ABNs identified in this extract must be reported on.

This will ensure any new small business suppliers engaged with during the reporting period will all be captured.

Small businesses that have chosen to opt out of the SBI tool will also be excluded from the aggregate data.

Reporting entities can also use the SBI tool at any other time. For example, to assess their current payment terms and practices in relation to their small business suppliers.

Small business opting out of the SBI tool

Small businesses concerned about being identified as a small business can opt-out of being identified in the SBI tool. They can do this online via the reporting portal. They also have the ability to opt back in.

Small businesses that have opted out will not be included in the aggregate data provided in payment times reports.

Small business suppliers that do not have an ABN (e.g. foreign entity/overseas suppliers) do not need to be reported on by a reporting entity.

Updating SBI tool identification status

Updating your business details

If a business believes that it has been incorrectly identified by the SBI tool, the business can directly update the SBI tool by registering its correct business details in the payment times portal.

To register in the portal the business will need to enter its business details, including its total income. Registering its details in the portal will not result in the business needing to report. It will only do so if it meets the eligibility criteria.

The portal will automatically update the SBI tool with the correct business size once these details are provided.

Updating a suppliers details

If a large business identifies a supplier in the SBI tool that they do not believe to be a small business, they can advise the business of the above process.

Alternatively, the large business can request the Regulator’s office to correct their details by: