Sunshine Coast and Brisbane Accountants - Clarke McEwan Accountants and Business Advisorrs
Sunshine Coast and Brisbane Accountants - Clarke McEwan Accountants and Business Advisorrs

Federal Budget 2025-26: what it means for your small business

Clarke McEwan Accountants

The Treasurer, Jim Chalmers, delivered the Federal Budget 2025 on Tuesday 25 March. With a general election scheduled for 2025, this Budget was an important one, setting out the Albanese Labor Government’s financial plans for the future path of Australia.


cut in the lowest rate of income tax from 16% to 15% by 2026 may be a vote winner, but was there any good news for Aussie small businesses among the announcements?


We’ve summarised the key points that may have an impact for you and your business.


Overview of the main Federal Budget


The Treasurer focused on cost-of-living relief, strengthening Medicare and building key foundations for Australia’s future. Key measures include tax cuts for all taxpayers, energy bill rebates for households and small businesses, cheaper medicines and student debt relief.


Significant investments have been allocated to housing, education and infrastructure projects, aiming to boost productivity and resilience. The Government has also emphasised economic responsibility, highlighting improvements in debt and deficit figures since Labour came to office.


Initiatives also target fair competition, regional development and support for small businesses, with a focus on the green policies of the Future Made in Australia initiatives.


Announcements that may affect your small business


Here are the main announcements from the federal Budget that could have a positive impact for you and your small business:


Energy Bill Relief


Approximately one million small businesses will receive energy relief until the end of 2025, providing a $150 reduction in energy bills this year. This will help mitigate the impact of ongoing high energy costs for many small business owners.


Energy Efficiency Grants for SMEs


The Energy Efficiency Grants for Small and Medium Sized Enterprises (SMEs) program is providing $56.7 million in grants of up to $25,000 to over 2,400 businesses, funding a range of energy upgrades, such as replacing inefficient appliances and improving heating systems.


Competition and Fair Trading


The government is cracking down on supermarkets’ unfair trading practices, which will help level the playing field for small businesses. This includes empowering the ACCC, the competition watchdog, making the food and grocery code mandatory and increasing penalties.


Future Made in Australia


The Treasurer announced more support for the production of Australian-made green metals, which could create opportunities for businesses in related supply chains.

The Government is backing clean technologies through the Future Made in Australia Innovation Fund, which could provide funding and support for businesses in this sector.


Support for Small and Local Businesses


The Budget included continued support for a raft of small business initiatives, aimed at making it easier to start, run and grow small Australian enterprises.


These included:

  • Measures to protect small and local businesses from unfair trading practices.
  • Funding for the Buy Australian Campaign to support local producers.
  • Providing new resources for regulators to ensure a level playing field.
  • Tax relief for hospitality venues, brewers, distillers and wine producers.


National Broadband Network (NBN)


Increased funding of $3 billion in equity to complete the NBN rollout, which is essential for business productivity, particularly in regional and remote outback areas.


National Licensing


Introduction of a national licensing scheme for electricians, with the intention to expand this to other trades, reducing red tape and making it easier for trades to work between states.


Non-compete clauses


Abolishing non-compete clauses for most Australian workers will create more worker mobility, and also making it easier for people to create small businesses.


Major infrastructure investment



Major infrastructure investment in building new housing, upgrading highways and servicing the rail network will provide opportunities for many small contractors.


Helping you plan for the proposed Budget changes


If you believe any of the Treasurer’s Budget announcements will affect your small business, we’re here to explain the changes, find a solution and grab the opportunities.


By Clarke McEwan March 21, 2025
As your accountant, we won't just look after the financial side of your business, we can also advise you on the strategic side of your company, including the importance of business development as vital part of your growth plan. Business development (BD) is what helps your company move from slow, organic growth to fast-paced, hypergrowth. And it’s only by putting the right drive and expertise behind your BD that you can turn your strategic ideas into real success stories. So, how can we help you achieve this? Talk to you about your strategic goals The starting point for any kind of BD activity is to pin down your goals and aims as a business. When you know what you want to achieve over the coming months, it’s far easier to define a strategy for success. And that’s easier to do when you talk to an objective adviser, like us. We can sit in on your board meetings, talk to your executive team and get a real handle on what makes the business tick. And, armed with this knowledge, we’ll work with you to drive the direction of your BD and find the best opportunities for you to focus on. Help you create a clear BD strategy and plan Having a defined set of BD goals is a good starting point. But to put this all into action in a productive way, you’re going to need a comprehensive plan for your BD projects. Our years of experience advising business leaders and their teams really comes into play here. We know the best routes to take, the budgets that will be needed and the right tactics for bringing in more contracts, sales and partnerships. By putting these strategies into a clear plan, and linking this to agreed timescales, you have a BD route map to follow and action. Introduce you to a broader network of business partners We work with a wide range of businesses across many different sectors, industries and niches. By introducing you to our network of clients, we welcome you into a supportive community of like-minded business owners. And that’s excellent news when looking for new partnerships. Whether it’s attending a local conference, an online webinar or one of our in-house client events, you’re going to meet new people, share new ideas and make the right connections. This is a great way to build alliances and work together with other local businesses. And when you’re well-connected, you set the very best foundations for your future BD activity. Provide better routes to funding and investment Whatever goals you’ve set for your BD projects, it’s likely that you’re going to need additional funding to finance this activity. Investing in your expansion, or new partnerships, is vital to getting a good return on your BD, so great access to finance is a definite bonus. We’ll advise you on the most appropriate funding channels and how you can use these facilities to finance your BD plans. And we can also link you up with banks, lenders and business finance specialists – so you get the advice and finance you need to bring your BD to life. Help you track and measure your BD performance Meeting your BD targets takes time – and a whole lot of dedication. Measuring your BD performance over time, helps you stay on track and gives you a good indication of how well you’re tracking against your planned progress. We’ll help you create the reporting and metrics you need, so you have clear data to track your progress over time. You can log your activity in your project management system, or your client relationship management (CRM) software, and keep clear notes on contacts made, relationships built and targets converted etc. If you want to get more from your BD, please do get in touch. We’ll partner with you to put some real drive, experience and impetus behind your BD strategies.
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Global Google searches for the word “tariffs” spiked dramatically between 30 January and 2 February 2025, a +900% increase to the previous 12 months. We look at what tariffs really mean. Who pays for tariffs? Tariffs increase the price of imported goods and reduce trade flows of that good or service. Traditionally used to protect specific domestic industries by reducing competition, tariffs increase the price of foreign competitors and reduce demand. In his first term, President Trump imposed a 25% global tariff on steel and a 10% tariff on aluminium (which Australia managed to reduce to zero with supply limits imposed instead). The impact was reportedly a 2.4% increase in the price of aluminium and 1.6% increase in the price of steel in the domestic US market. The cost of tariffs is not borne by overseas suppliers but indirectly through a reduction in trade and domestically through higher prices, particularly where those goods and services are common. 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In 2023, the US represented 77% of Canada’s total goods export. · Mexico - 25% additional tariff on imports from Mexico . Mexico has responded with its own 25% tariff on US goods. · China - 20% additional tariff on imports from China. The US trade deficit was over $900bn in 2024 of which China accounts for around $270bn. The additional tariff on postal shipments from China to the US has since been temporarily suspended for items with a value under $800 until the US postal service is able to collect the tariff. China’s response has been to impose additional tariffs on certain US imports including a targeted 15% tariff on agricultural products including chicken, wheat, corn and cotton, and a 10% tariff on fruit, vegetables, dairy products, pork, beef and sorghum. Export controls have been placed on some critical minerals. In addition, China has filed a complaint to the World Trade Organization. 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Australia has a large trade surplus with the US which would normally make the imposition of tariffs less likely. However, specific industries may be impacted by product or industry based tariffs, such as steel and aluminium. The largest American imports into Australia are financial services, travel services, telecoms/ computer/ information services, royalties and trucks. Australia’s largest exports to the US are financial services, gold, sheep/goat meat, transportations services and vaccines. Impacts of trade wars on Australia Australia is impacted indirectly by demand. China is Australia's largest two-way trading partner, accounting for 26% of our goods and services trade in 2023. If Chinese demand slows as a result of a trade war, Australia’s economy will slow. But there is a pattern in President Trump’s approach to international and trade relations that suggests that an all-out trade war might not occur: a bold line or policy is stated - a statement that tells a story to the US public consistent with his election sentiments; then, wound back either partially or fully after concessions have been secured or concessions stated. For Australia, there is a risk in these policy machinations that China again agrees to reduce the US trade deficit by purchasing more from the US, potentially to the detriment of Australian suppliers. For Australian business, uncertainty and volatility is the problem. Uncertainty slows the economy and impacts business revenue while at the same time, costs may increase. For those in the business of selling product manufactured and distributed from China or through other trading partners directly impacted by tariffs, watch for more supply chain issues and potential cost increases. If the US export markets retracts, there is also a risk other trading nations look to dump their products to help offset losses.
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“Succession planning, and the tax risks associated with it, is our number one focus in 2025. In recent years we’ve observed an increase in reorganisations that appear to be connected to succession planning.” ATO Private Wealth Deputy Commissioner Louise Clarke The Australian Taxation Office (ATO) thinks that wealthy babyboomer Australians, particularly those with successful family-controlled businesses, are planning and structuring to dispose of assets in a way in which the tax outcomes might not be in accord with the ATO’s expectations. If you are within the ATO’s Top 500 (Australia's largest and wealthiest private groups) or Next 5,000 (Australian residents who, together with their associates, control a net wealth of over $50 million) programs, expect the ATO to be paying close attention to how money flows through the entities you control. A critical issue for many business owners is how to effectively (and compliantly) benefit from a successful business. In many cases, the owners have spent years building the business and the business has become not only a substantial asset, but a lucrative source of income either through salary and wages, dividends, or through the sale of shares or assets. Generally, under tax law, you can legitimately structure assets if there is a good reason to do so - like for asset protection, but if you tip across the line and the only viable reason for a structure is to reduce tax, then you risk the ATO taking a very close look at your operations or worse, denying any tax benefits under the general anti-avoidance rules in Part IVA of the tax rules, designed to combat “blatant, artificial or contrived” tax avoidance activities. “We’re seeing that succession planning behaviour is primarily done by group heads who are approaching retirement. They typically own groups that family members are a part of, and wealth is transferred to the next generation to keep it within the family (via trusts and other means),” ATO Private Wealth Deputy Commissioner Louise Clarke said in a recent update. Key areas of concern include:  Division 7A loans being settled. That is, a company has been paying money to a shareholder or an associate under a loan account. The ‘loan’ is quickly settled, often via a distribution, to remove it from the accounts. Assets moving around the group (often the true value of an asset is not recognised raising the question, why the change if not to avoid capital gains tax on disposal or for some other benefit). Family member interests being restructured . Trust deeds being amended. A restructure is cited as a reason for late lodgment. Use of trusts Trusts are also a key area of concern in 2025. Where a trust which has made a family trust election (FTE) or interposed entity election (IEE) makes a distribution outside of the family group, a 47% Family Trust Distribution Tax applies (tax at the top marginal tax rate plus Medicare). In addition, the ATO has recently tightened its approach to trust tax returns for closely held trusts to ensure that trustee beneficiary (TB) statements are being completed. These are required when a trust makes a distribution of income or assets to the trustee of another trust, unless an exclusion applies. For example, a trust which has made an FTE or IEE doesn’t need to make a TB statement. The TB statement will then be used to cross reference against what the beneficiary has declared in its tax return. Where a valid TB statement is not made on time this can trigger a hefty 47% Trustee Beneficiary Non-Disclosure Tax. Reducing risk Where you or your family have control over multiple entities, particularly where the value of these entities is significant, it is important that the connections between these - be it in Australia or overseas - are looked at closely to avoid any nasty surprises or lost opportunities. Transferring control of your business may involve restructuring your business operations – changes to share structures, changes to the trustee and appointor of a trust, changes to partnership structures – or transferring assets to family members via the creation of trusts or other entities. All these events have legal and tax implications that need to be carefully considered. Contact us to assist you with your succession and tax planning.
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