For business owners, the 2026–27 Federal Budget is a mixed picture — genuine relief in some areas, significant structural reform in others, and several measures that require action well before their commencement dates. Here is what you need to know.

Permanent $20,000 instant asset write-off

The $20,000 instant asset write-off has been made permanent for small businesses with turnover under $10 million, effective from 1 July 2026. No more waiting each year to see if it will be extended. Any eligible asset costing less than $20,000 can be immediately deducted in the year it is purchased and ready for use.

For businesses that have been holding back on equipment purchases because of uncertainty around the write-off, this removes that uncertainty. Plan your capital expenditure with confidence.

Key date: Permanent from 1 July 2026.

Loss carry-back returns — this is a genuine cash flow measure

From 2026–27, eligible companies with global turnover under $1 billion can carry back revenue losses and offset them against tax paid in the prior two income years, receiving a cash refund rather than waiting to use those losses against future profits.

For businesses that have had a strong year followed by a difficult one — or that are investing heavily in growth and generating short-term losses — this is meaningful. A company that paid $50,000 in tax last year and makes a $50,000 loss this year can receive a refund rather than sitting on a loss carry-forward.

The refund is limited by the company's franking account balance, so it doesn't create a refund where no tax was actually paid. But for businesses that cycle between profitable and loss-making years, this restores a sensible and important cash flow mechanism.

Key date: 2026–27 income year onwards.

Start-up loss refundability — for new businesses in their first two years

From 1 July 2028, small companies under $10 million turnover in their first two years of operation will be able to convert tax losses into a refundable offset, capped at the value of FBT and withholding tax paid on employee wages. This rewards early-stage businesses that are investing in Australian jobs during their formative years and is expected to benefit up to 25,000 new companies annually.

Key date: 1 July 2028.

Discretionary trusts — the most significant change for family businesses

This is the change that will have the greatest impact on the broadest range of Atramentum's business clients.

From 1 July 2028, a minimum 30% tax will apply to the taxable income of discretionary (family) trusts. The tax is levied at the trustee level, with beneficiaries receiving non-refundable credits. Importantly, this effectively ends the use of "bucket companies" — corporate beneficiaries will now face tax at both the trust level and the company level on the same income.

For business owners who have relied on trust structures for income splitting, tax planning, and asset protection, this fundamentally changes the calculation. Trust income will now be taxed at a minimum of 30% regardless of the marginal rate of the beneficiary receiving it. The tax effectiveness of discretionary trusts is significantly reduced.

The Government has provided a three-year restructure relief window from 1 July 2027 for businesses that need to change their structure. Unit trusts, complying superannuation funds, charitable trusts, deceased estates, and special disability trusts are excluded from the minimum tax. Primary production income and certain income for vulnerable minors are also excluded.

The window to act is real — but it is not unlimited. Restructuring from a discretionary trust carries its own costs and consequences, including potential stamp duty implications at a state level. The earlier you begin this conversation, the more options you have.

Key date: 1 July 2028 (minimum tax). Restructure relief window: 1 July 2027 to 30 June 2030.

Capital gains tax — what changes for your business

From 1 July 2027, the 50% CGT discount for individuals, trusts, and partnerships on assets held more than 12 months is replaced by cost-base indexation and a minimum 30% tax on real capital gains.

For business owners, this affects the sale of business assets, goodwill, investment assets held through a trust, and the business itself. The small business CGT concessions — the 15-year exemption, active asset reduction, retirement exemption, and rollover — remain in place and can significantly reduce or eliminate CGT on a qualifying business sale. However, how they interact with the new minimum tax rules requires careful analysis.

If you are planning to sell your business or any significant assets, the timing relative to 1 July 2027 matters. Gains accrued up to that date still attract the 50% discount. The longer a sale is delayed beyond that date, the more of the gain falls under the new regime.

Key date: 1 July 2027.

Payday super — action required now

From 1 July 2026, businesses must pay the super guarantee on each payday rather than quarterly. This is already in effect as of this financial year. If your payroll system isn't set up for this, it needs to be addressed immediately — the ATO has signalled this is a compliance priority.

For businesses with multiple employees or complex payroll arrangements, the cash flow impact of moving from quarterly to per-payroll super payments is also worth modelling. Money that previously sat in your account between quarterly payments will now be disbursed more frequently.

Key date: 1 July 2026. Action required now.

GIC and SIC interest — no longer deductible

From 1 July 2025 (already in effect), General Interest Charge and Shortfall Interest Charge on ATO debts are no longer tax deductible. For businesses managing ATO payment plans, this increases the real cost of those arrangements. If you carry an ATO debt, the after-tax cost of that debt has increased and it is worth reviewing whether alternative financing options are more cost-effective.

R&D tax incentive — changes for tech and innovation businesses

From 1 July 2028, the R&D Tax Incentive is being restructured. The offset for core experimental R&D increases by 25–50%, but eligibility for supporting R&D expenditure is removed. If your business currently claims the R&DTI, you should review what proportion of your current R&D expenditure is classified as core versus supporting activity — supporting expenditure such as literature reviews and equipment maintenance will no longer qualify.

The refundable offset turnover threshold increases from $20 million to $50 million, and the maximum expenditure cap increases to $200 million. For growing R&D businesses, these are positive changes.

Key date: 1 July 2028.

EV fringe benefits tax — the exemption is being phased out

The full FBT exemption for electric vehicles under $75,000 continues until 1 April 2029, after which a permanent 25% FBT discount applies. If your business has EV salary packaging arrangements in place, review them ahead of the 2029 transition. For EVs over $75,000 acquired from 1 April 2027, a 25% discount (not full exemption) applies immediately.

Key date: 1 April 2027 for higher-value EVs. 1 April 2029 for all EVs.

PAYG instalments — more flexibility coming

From 1 July 2027, businesses will be able to opt into monthly PAYG instalments calculated dynamically through business software, aligning tax payments more closely with actual business activity. This is optional but useful for businesses with volatile or seasonal income.