Federal Budget 2025–26: What Businesses Need to Know

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The Federal Budget delivered on 25 March 2025 brought few surprises for Australian businesses. While there were no major new tax measures, the Budget did confirm some changes, defer others, and left many big questions unanswered.

Key Deferrals

Two previously announced measures have been pushed back:

  • Capital Gains Tax (CGT) for non-residents – the start date has been deferred until after Royal Assent (and no earlier than 1 October 2025). Originally, it was due to apply from 1 July 2025.
  • Clean building managed investment trust (MIT) regime – expansion to include data centres and warehouses has also been delayed until after Royal Assent.

These delays mean businesses now have more time to plan, but also more uncertainty about when the rules will apply.

Confirmed Measures

The Budget confirmed that:

  • MITs with a single widely-held owner will be acceptable, with amendments backdated to 13 March 2025.
  • The ATO will receive $700 million over four years to continue its Tax Avoidance Taskforce, with an expectation of raising an additional $3 billion in revenue.

Silence on Key Issues

Notably, the Budget did not address several significant previously announced measures, including:

  • Amendments to Part IVA anti-avoidance rules.
  • New penalties for mischaracterised royalties, interest or dividends.
  • Application of shortfall interest charges to overclaimed offsets.

It also remained silent on how Australia will respond to shifting US tax policy. With proposed US legislation targeting foreign tax rules considered “extraterritorial”, there’s potential for conflict with Australia’s multinational tax measures.

Last-Minute Legislation

Just before the Budget, Parliament passed the Treasury Laws Amendment (Tax Incentives and Integrity) Bill 2025, which:

  • Extended the $20,000 instant asset write-off for small businesses for the 2025 income year.
  • Denied deductibility of shortfall and general interest charges for assessments on or after 1 July 2025.

What This Means for Businesses

For most Australian businesses, this Budget was “steady as she goes.” While it avoids sudden shocks, it leaves many unresolved issues hanging. Businesses should:

  • Monitor the timing of deferred CGT and MIT changes.
  • Take advantage of the extended $20,000 write-off where eligible.
  • Prepare for continued ATO scrutiny, especially large businesses and multinationals.

The Bottom Line

This year’s Budget is more about maintenance than reform. With international tax tensions brewing and several key measures left in limbo, businesses should stay alert and keep their planning flexible. 👉 Need tailored advice on how these measures could affect your business? Contact Richard A Bobb Chartered Accountants for expert guidance.

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