Federal Budget 2025-26: What It Means for Australian Business Owners and Personal Wealth Planning 

Article Summary:

The 2025–26 Federal Budget delivers a range of measures focused on cost-of-living relief, healthcare, energy support, and modest tax cuts—with an eye to the next federal election. For Cosca clients—small to medium business owners, pre-retirees, and wealth builders—understanding what’s changing is crucial. In this article, we break down the practical implications of the Budget for your business and personal finances, and offer expert insights across our Strategic Accounting, Personal Wealth, and Business Advisory services.

How will the personal income tax cuts affect me?

From 1 July 2026, “modest” two-stage tax cuts will apply to all taxpayers, with further relief from 1 July 2027.

Revised Tax Brackets:

Threshold	2025–26 Rate	2026–27 Rate	2027–28 Rate
$0 – $18,200	Tax-free	Tax-free	Tax-free
$18,201 – $45,000	16%	15%	14%
$45,001 – $135,000	30%	30%	30%
$135,001 – $190,000	37%	37%	37%
$190,001+	45%	45%	45%

• Individuals will receive a tax cut worth about $5 per week, increasing to $10 per week by 2026–27, aimed at offsetting inflationary pressures.
• The Medicare Levy low-income thresholds have also increased to protect more low-income earners from the additional tax burden.

This equates to an annual saving of up to $268 in 2026–27 and $536 in 2027–28 for most Australians.

Cosca Insight:

The changes are modest at best, but provide some room to review your salary sacrifice levels, Superannuation strategies and Family Trust Distributions.

What relief is offered for energy costs?

Rising operational costs—especially utilities—are a concern for many of our business clients. The Budget includes:

• Households and small business will receive an additional automatic credit of $150 on their energy bills in quarterly instalments between 1 July 2025 and 31 December 2025.

Cosca Insight (Business Advisory):
Use this relief as an opportunity to review broader operational expenses. It’s also a great time to assess eligibility for energy-efficiency grants or programs to lock in long-term cost savings. 

What support is available for healthcare?

• $8.5bn on Medicare for increases to Medicare payments, 50 new urgent care clinics, and a bulk billed GP service.
• $1.8bn over 5 years for cheaper medicines on the Pharmaceutical Benefits Scheme.
• $240m for women’s health – reproductive health and menopause

What support is available for housing?

• $800m expansion of the ‘Help to Buy’ scheme.
  • The Government’s ‘Help to Buy’ program reduces the deposit required to buy a home by providing an equity contribution. Under the program, Housing Australia provides eligible participants with a Commonwealth equity contribution of up to 30% of the purchase price of an existing home and up to 40% of the purchase price of a new home. That is, they will give you the money and take a stake in your home.
  • Originally, to be eligible for the program, the income threshold for a single was $90,000 and, for joint participants, $120,000. The Budget increases this threshold to $100,000 and $160,000 respectively. Additional conditions apply.

Cosca Insight (Personal Wealth):
These initiatives benefit clients looking to assist family members in entering the housing market, or those managing ageing-related healthcare planning. Our advisors can help structure intergenerational wealth strategies accordingly.

What changes are being made to education and student debt?

• 20% HECS-HELP debt reduction.
• Adjusted repayment schedules from 1 July 2025.

Childcare

Three days of subsidised childcare for families with young children (income tested) from 1 January 2026 replacing the Child Care Subsidy activity test.

Cosca Insight (Family Wealth):
This creates new financial flexibility for younger generations. We can help integrate this into your family financial planning.

What are the broader economic implications for businesses?

While this Budget delivers targeted relief, it forecasts a return to deficits, with:

• A $26.9 billion deficit in 2024–25
• Growing to $46.9 billion in 2025–26

This may put pressure on future policy settings, interest rates, and the broader economy.

Cosca Insight (Strategic Accounting & Business Advisory):
Now’s the time to strengthen your business’s financial resilience. We recommend scenario planning for interest rate changes and maintaining a buffer for future tax or compliance shifts.

FAQs

Q: When will the new tax cuts come into effect?

A: From the 2025–26 financial year, with incremental increases through to 2027.

Q: How can I support my children to enter the property market under the Help to Buy scheme?

A: Eligibility criteria apply, but Cosca can help structure financial assistance and ensure tax-efficiency in how support is provided.

Q: What steps should I take now in response to the Budget?

A: Book a review with Cosca’s advisory team to explore tailored strategies aligned with these new policies.

How Cosca Can Support You Through These Changes?

The 2025 Federal Budget includes several measures aimed at softening economic challenges for Australians and stimulating long-term growth. For our clients, the opportunities lie in how you adapt your financial and business strategies.

• Our Strategic Accounting team can help you maximise tax efficiency and structure business investments wisely.
• Our Business Advisory experts can assist you in cash flow forecasting, asset planning, and growth strategy alignment.
• Our Personal Wealth advisors can support retirement planning, intergenerational wealth transfer, and optimisations.

Let’s review your position and ensure you’re making the most of the budget outcomes.

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