The budget. What it means for SME’s and high-net-worth individuals

The Australian Federal Budget for 2025–26, announced on March 25, introduces a series of measures that directly and indirectly affect small to medium-sized enterprises (SMEs) and high-net-worth individuals (HNWIs). From an accountant’s perspective, these changes are modest — perhaps even pedestrian — but still warrant careful review for their potential business implications.

As a specialist in this sector, we’ve summarised the key budget highlights and practical insights on how they might impact your business or personal finances.

Small businesses will benefit from a $150 rebate on their electricity bills, continuing the government’s energy relief initiative. Over the past three years, this has added up to as much as $800 in total savings per business.

This rebate is available to businesses classified as ‘small customers’ by electricity providers. If you’re unsure of your eligibility, review your energy contract or contact your supplier.

While the rebate is modest, it can help offset rising operational costs. We recommend applying the savings toward cash flow support or investing in energy-efficient systems to reduce long-term costs.

From July 1, 2026, the tax rate on income between $18,201 and $45,000 will be reduced from 16% to 15%, and again to 14% from July 1, 2027. Individuals earning above $45,000 will benefit from annual tax savings of $268 in 2026–27 and $536 thereafter.

These cuts provide incremental relief for SME owners who draw a salary, though bracket creep remains a broader concern. Now may be a good time to reassess your salary structure, especially in family-run businesses or trust arrangements.

The government is expanding its shared equity scheme for first home buyers, allowing it to take a stake of up to 30% in existing homes and up to 40% in new builds.

Though this measure targets individuals, businesses may benefit indirectly. Home ownership incentives can improve employee satisfaction and retention, especially among younger staff.

It may be worth considering promoting housing assistance programs during recruitment campaigns, particularly in industries experiencing talent shortages.

The Australian Taxation Office (ATO) has received additional funding to extend its Tax Avoidance Taskforce for another year. This indicates continued scrutiny of compliance across areas such as:

• Discretionary trust distributions
• Inter-entity transactions
• Contractor vs employee classifications

Accurate and consistent record-keeping and proactive tax planning are essential for SMEs and HNWIs. We recommend conducting a pre-year-end review to ensure alignment with ATO expectations and reduce audit risk.

Despite some supportive measures, the budget has been critiqued for lacking meaningful assistance for SMEs. Absent are:

• R&D tax incentives
• Digital innovation grants
• Export development support

These omissions may hinder business growth and innovation, particularly in competitive global markets.

We advise considering exploring alternative funding sources, such as state government grants, industry-specific programs, or private capital, to fuel expansion and development.

For HNWIs, the 2025–26 budget introduces no significant changes to personal income tax, capital gains tax (CGT), or superannuation thresholds — providing some welcome stability for long-term planning. However, with continued investment in the ATO’s compliance initiatives, those with complex structures (e.g. family trusts, offshore investments) should expect sustained scrutiny.

We recommend revisiting your asset protection and estate planning strategies to ensure they remain compliant and tax-effective under the current regime.

While the 2025–26 Federal Budget provides incremental benefits, it falls short in delivering transformative support for business innovation and competitiveness.

Key takeaways include:

• Utilise available tax and energy rebates
• Reinforce your compliance frameworks
• Seek out non-federal funding and support options

As always, a tailored approach can help you maximise available opportunities while mitigating risks. If you’d like to discuss how the budget may impact your business or personal finances, please don’t hesitate to contact our office.