Federal Budget 2025/26: What it means for SMBs and IT Spend

The Federal Budget 2025/26 has been released, and for Australia’s small and medium businesses (SMBs), the key question is: What does this mean for growth, digital transformation and IT investment?

With a focus on tax policy, government incentives, cost of living management, and regulatory measures, the Budget will undoubtedly shape business confidence and spending in the year ahead. 

For our partners and your SMB customers, the critical question is: How can business leaders turn these policies into growth opportunities and what actions should be taken? 

Keep reading to find out.  

1.Let’s address the big one. Instant Asset Write-Off. 

It was announced from July 1, 2025, the Instant Asset Write-Off threshold will drop from $20,000 to just $1,000, offering SMBs a limited window to maximise tax benefits on IT upgrades. However, Labour has recently pledged to extend the instant asset write-off measure by an additional 12 months. This uncertainty does require SMBs to rethink capital expenditure strategies, at speed. 

Tony Sloan, Partner, Corporate & International Tax at BDO said, “The budget was very short on tax measures, apart from the 73 cents per day tax cut. Shortly after the budget, the $20k small business asset write off was passed into law. This allows small businesses to claim $20k up to 30 June 2025. Businesses have 3 months to buy equipment before the deadline on June 30th.”  

Key actions to consider:  

• Plan for asset purchases now – IT infrastructure is central to business modernisation. Start thinking about what tech upgrades you and your customers need. Lean on our Dicker Data team for access to some of the world’s leading tech vendors, solutions and expert guidance. See here. 

• Upgrade to Windows 11 – As support for Windows 10 ends on October 14, 2025, Dicker Data’s Windows 10 Device Refresh roadmap can help partners and SMBs transition efficiently to Window’s 11, ensuring cybersecurity, compliance, and productivity. Failure to upgrade could void insurance policies and expose systems to cyber threats. Partners can leverage our team’s expert guidance, incentives, financing options, and deployment support to accelerate the transition.

• What role is AI going to play in both your business, and your customers' business? This could mean investing in Copilot licenses for your team, considering AI PCs to help your team get the most out of your AI investments, or providing data governance and assessment services to your end-customers before you deploy AI more widely. Check out our getting started with AI guide.

• Explore IT financing – If partners miss the Instant Asset Write-Off deadline, Dicker Data Financial Services provides flexible financing options to support cash flow and long-term digital transformation goals. 

The countdown is on—act now to secure tax benefits and future-proof your IT investments. 

2. Energy Efficiency Grants: Up to $25K in Funding for IT Upgrades and $150 energy bill rebate 

Sustainability is fast becoming a key priority. The Government’s $56.7 million Energy Efficiency Grants program will help SMBs reduce energy consumption and costs. Eligible businesses can access up to $25,000 to invest in energy-efficient IT solutions and infrastructure, plus receive a $150 energy rebate from July 1, 2025, paid in two quarterly instalments.     

Key actions to consider:  

• Leveraging grants will help improve energy efficiency practices, consumption, costs and modernise with energy-energy efficient IT infrastructure.   

• SMBs will need to check eligibility for the $25k grant, which is available for those with an employee head count of 1-199.

• Switching to energy-efficient servers and cloud storage will lower long-term costs. Get in touch with us to find out more about these products and solutions. 

 3. $3 Billion for NBN Rollout: Faster Internet, Better Digital Tools

The Budget committed $3 billion to finalise the National Broadband Network (NBN) rollout. Although contentious, this may pose good news for IT providers, as SMBs rely heavily on high-speed internet to drive operations, enhance productivity, and support remote work initiatives. 

Key actions to consider:  

• SMBs will be encouraged to accelerate digital transformation initiatives with speed, giving IT providers the opportunity to offer additional and value-added services to drive greater operational efficiency, future proof infrastructure and modernise their technology stack. 

• With increased speed, SMBs face higher cyber risks. Leverage our presales support, opportunity scoping, demos, proof of concept, and MSP setup, along with access to a wide range of security and cyber resilience vendors. 

• Connectivity will boost remote work capabilities. IT partners can facilitate faster cloud adoption and enhance the reliability of remote work solutions, improving productivity and flexibility.

• Review networking infrastructure: Increased speed is great, but is your current network a bottleneck to unleashing the full potential of the increased gains? Older network infrastructure may cap the speed your users get at their devices, and older WiFi infrastructure, particularly those without mesh capabilities, may also be limiting your teams' ability to access the increased speeds.

4. Digital & Cybersecurity Support: Government Programs Still Available

Digital and AI were not a big focus in this year’s budget. However, cybersecurity remains a national security priority. Since the 2023–24 Budget, the Government committed more than $60 million in programs supporting digital adoption and cybersecurity to help SMBs lift their digital and cybersecurity capabilities. This includes:  

• Digital Solutions Program (helping businesses go digital)  

• Cyber Wardens Program (training staff to prevent cyber threats)  

• Cyber Health Check (assessing vulnerabilities)  

• Small Business Cyber Resilience Service  

Key actions to consider:  

• Partners should audit and review customer cybersecurity measures and apply for available funding  

• New government regulations require businesses to enhance cybersecurity resiliency and report breaches faster 

• Our recent research from 2024 showed only 24% of CIOs seek IT partners for cybersecurity solutions, highlighting a big opportunity in 2025. Dicker Data offers a comprehensive range of cybersecurity solutions helping businesses scope, design, and deliver best-practice tech stacks to protect against cyber threats. 

• The Government's Essential 8 framework is a great stating place for partners who are looking for where to get started with cybersecurity. 

5. Business Register Stabilisation: Stronger Digital Compliance

The Government allocated $207 million to stabilise Australia’s business registers, including ASIC funding to enhance digital compliance and enforce Director ID regulations. 

Key actions to consider:  

• Ensure compliance with ASIC’s digital requirements to avoid penalties. 

• Speak to a Dicker Data expert to review data security measures to align with updated regulations. 

6. Support for Innovation & Startups: $400M Industry Growth Program

The Budget highlighted the $400 million Industry Growth Program, which offers advice and matched funding for startups and SMBs developing innovative projects, helping them commercialise ideas and scale. In a digitally driven and hyper AI adoption era, this will be helpful for IT providers and businesses looking to invest in leading technology.  

 Key actions to consider:  

• Businesses can apply for funding to scale digital transformation initiatives. 

• Dicker Data IT partners can help startups access expert guidance, streamline IT operations, and implement scalable solutions that align with their growth objectives. Our team of technical presales specialists are an extension of your team, and can help you scope, design and deploy technology at scale.  

7. Workforce & Regulatory Changes: New Business Rules to Watch

• Fast Payment Times on Government Projects 
  To improve cash flow for SMBs, the Government is mandating faster payment terms on public projects. Government Business Enterprises (e.g., NBN Co, Western Sydney Airport Corporation) must pay SMB contractors within 20 days, improving cash flow.
  

• Stronger Fair Competition Protections 
  The Government plans to extend unfair trading practice laws to cover SMBs, addressing power imbalances in negotiations and unfair contract terms. 

• Non-Compete Ban & Workforce Mobility 
  SMBs should consider the role cutting-edge technology can play in retaining people and deploying that as a strategy for both their own businesses and their customers. 

Key actions to consider:  

• Ensure contracts are compliant with fair competition rules. 

• Invest in workplace culture, career development programs and tech solutions like AI & Automation that enhance productivity and engagement. Ask us about Dicker Data Training and Enablement opportunities. 

Your next steps 

SMBs have a unique opportunity to unlock government incentives and programs to drive key tech investment priorities. By focusing on areas such as AI and Automation, Cybersecurity, Cloud & Digital Infrastructure, and Workforce and Skills Development for IT Professionals, businesses can not only enhance their operational efficiency and innovation but also ensure long-term resilience and competitiveness in an evolving market.  

To help identify and land your next opportunity, here are five questions you can ask your end customers: 

1. What role will AI play in your organisation?  AI has moved beyond hype, and solutions like Microsoft Copilot are driving real world impact by saving time, money and making people more efficient. Now is the time to determine what role AI is going to play in your future, and then invest in making it a success. 

2. What other strategic initiatives are you focusing on to drive growth and innovation in your business? This can open up a discussion about your customer's key projects and how they align with government budget opportunities. 

3. Have you planned for asset purchases to maximise the Instant Asset Write-Off before July 1, 2025? This can help identify immediate IT upgrade needs and encourage customers to take advantage of the current tax benefits within this financial year. 

4. Have you explored the available government programs for digital and cybersecurity support? These programs can provide valuable insights on how to leverage funding and resources to enhance your business's cybersecurity measures. Given the increasing cyber threats, it's an opportune time to review your current cybersecurity posture and identify opportunities to strengthen it. By doing so, you can ensure your business remains resilient and protected against potential cyber risks. 

5. How can faster internet and improved digital tools from the $3 billion NBN rollout enhance your business operations and support remote work initiatives? This can help explore opportunities for digital transformation and the adoption of new technologies to improve productivity and flexibility for your customers.   

Now is the time for SMBs to make their move and strategically leverage these incentives to drive business efficiencies and stay ahead of the curve. Our Dicker Data team is here to support you every step of the way. We have the resources and expertise to enable you to maximise the above opportunities. If you’re unsure where to start or simply want to reach out to discuss this further, please get in touch with your Dicker Data representative or reach out to us here: sales@dickerdata.com.au.  

Let’s navigate the Government incentives together, empowering you to drive digital transformation and growth in an evolving market. 

Note, the outcomes from the budget may or may not all come into effect, given we have an election on May 3rd.