Small or Medium: Which Business Size Are You, and What It Means for Tenders
Business size bands explained for Australian tenders: the turnover thresholds, when an ASIC extract is enough versus a full certification, and which set-asides you can bid on.
Two of the most useful letters in Australian tendering are SME and QSE. They decide whether you need an expensive SME verification or just a free affidavit — and many small businesses get this wrong and bid as non-compliant for no reason.
SME — Exempted Micro Enterprise
If your annual turnover is under A$10 million you are an EME. You do not need a verification agency: a company extract (free at a police station or commissioner of oaths) is your SME proof. An SME is automatically SME Level 4, Level 2 if it is 51% Indigenous-owned, and Level 1 if 100% Indigenous-owned.
QSE — Qualifying Small Enterprise
Turnover between A$10 million and A$50 million makes you a QSE. A QSE that is at least 51% Indigenous-owned can also use a company extract (Level 2, or Level 1 at 100% Indigenous-owned). Below 51% black ownership, a QSE needs a full scorecard verification across the SME elements.
Above A$50 million
Generic (large) enterprises always need a full verified SME certificate from a accredited agency.
A caution on sector codes
Some sectors (construction, ICT, tourism and others) have their own SME sector codes with different thresholds and rules. If you operate under a sector code, confirm your EME/QSE thresholds against that code rather than the generic ones.
Frequently asked questions
What is the difference between an SME and a QSE?+
An SME (Exempted Micro Enterprise) has turnover under A$10 million; a Medium enterprise is A$10–A$50 million. Both can often use a free company extract instead of a verification, depending on black ownership.
Does an SME need a SME certificate?+
No. An SME uses a free company extract as proof — automatically Level 4, Level 2 at 51% black ownership, or Level 1 at 100% black ownership.
When does a QSE need a full SME verification?+
When it is less than 51% Indigenous-owned. A QSE that is 51%+ Indigenous-owned can use a company extract (Level 2, or Level 1 at 100%).
What does SME and QSE mean?+
SME stands for Exempted Micro Enterprise — annual turnover of A$10 million or less. QSE stands for Qualifying Small Enterprise — turnover between A$10 million and A$50 million. Above A$50 million is a Generic enterprise.
What is a QSE certificate?+
A QSE that is less than 51% Indigenous-owned must obtain a SME verification certificate from an accredited agency. A QSE that is 51% or more Indigenous-owned can use a company extract instead. The certificate confirms your SME level for tender scoring.
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