Australia: Federal Budget 2025–26

10/4/25, 11:00 pm

By Neel Srivastava

The Albanese government has announced the 2025–26 to be focused on easing the cost-of-living pressures. What should SMEs know?

Changes in the Taxation System

Instant Asset Write-Off:

The $20,000 instant asset write-off will end in June 2025. After that, it drops back to $1,000. Need new equipment? Now’s the time to hit “Buy" before the end of this financial year.

Personal Income Tax Cuts:

Say g’day to more cash in your pocket. From 1 July 2026, personal income taxes will go down and then a further 1% a year later.

Utility Cost Relief

Electricity Rebate:

Small businesses will get $150 off their power bills split into two $75 credits by the end of 2025.

Energy Efficiency Grants:

There are more than $50 million in Energy Efficiency Grants providing up to $25,000 per business to upgrade appliances and promote efficient heating improvements.

Changes To Employment Laws

Non-compete clauses ban:

If your staff earn less than $175,000, you won't be able to use non-compete clauses in their contracts.

Wage-fixing and no-poach rules:

You also can’t make wage-fixing or no-poach deals with other businesses. These are now illegal.

Compliance and red tape

ATO Crackdowns:

The ATO is receiving an additional billion dollars in funding, with a major focus on multinationals and large taxpayers. Now is a good time to ensure that all your records are clean.⠀

Phoenixing in construction:

There is also increased ASIC funding to target illegal phoenixing practices, where businesses shut down to avoid debts and then start fresh. These practices are prevalent in the construction industry.

Franchisee protections:

The budget also promises increased collaboration with state and territory governments to crack down on unfair contracts and dodgy franchisors.

Unfair trading rules:

Unfair trading laws may soon be extended to protect small businesses, not just consumers.

Help For Hospitality and Brewers

The budget has also implemented a freeze on the draught beer excise for two years to support hospitality and alcohol producers. Moreover, there is a tax rebate cap for brewers and winemakers going up from $350k to $400k.