Key Announcements in the 2024/25 Federal Budget for Businesses

The 2024/25 Federal Budget has been  delivered by Treasurer Jim Chalmers. Here is a summary of the key business announcements.

Instant asset write-off scheme extended

The instant asset write-off scheme that was due to end on 30 June this year has been extended for another year. It will now end on 30 June 2025.

This scheme allows assets costing less than $20,000 to be fully written off as tax deductions in the year they are acquired or first used by eligible businesses with an annual turnover less than $10 million. Multiple assets purchased under the value of $20,000 can be written off.

Assets purchased for more than $20,000 must continue to be depreciated at the following rates:

  • 15% in the first year.
  • 30% for each subsequent year.

Business energy rebate

Eligible small businesses who have an annual electricity threshold below 100 megawatt hours will receive a $325 electricity rebate over the course of the next financial year. This rebate will be automatically credited to eligible customer bills from July 1 based on customer billing cycles. There is no need for businesses to formally apply for the rebate.

Tariff reforms

About 500 tariffs will be abolished on a range of imported goods from July including tools, clothing, fridges, dishwashers and toothbrushes in a move designed to ease business costs and compliance requirements.

‘Future Made in Australia’ incentives

The 2024/25 Budget provides time-limited incentives for businesses to invest in the green energy and constructions industries, including:

  • Easing eligibility requirements for $10,000 incentive payments for new energy apprentices employed under the New Energy Apprenticeships Program.
  • The extension of the $5,000 incentive payments for hiring new construction apprentices in priority occupations for a further year until 30 June 2025.
  • The Critical Minerals Production Tax Incentive which will provide eligible businesses with a tax offset of 10%  the cost of processing critical minerals for up to 10 years from 1 July 2027. The list of critical minerals is here.
  • The Hydrogen Production Tax Incentive which will see hydrogen producers provided with an uncapped subsidy per kilo of green hydrogen produced from 1 July 2027 for up to 10 years.  The incentive amount is still to be determined.

Forecasts for key macroeconomic business indicators

The 2024/25 Federal Budget forecast for key macroeconomic business indicators include:

  • Inflation to decrease from 3.6% to 2.75% by the end of the calendar year. If it does, this will provide conditions for  potential interest rate cuts. However, this Federal Budget inflation forecast is more optimistic than the Reserve Bank’s inflation forecast of 3.8% for the coming financial year. The federal government is hoping that measures such as their energy bill rebates for businesses and individuals will help to drive inflation down faster.
  • Unemployment to increase from 3.9% to 4.5% over the next financial year due to a slowdown in the global economy.
  • Real GDP (Gross Domestic Product adjusted for inflation) to increase by 2% over the next financial year, which is slightly lower than the longer range forecast of 2.25% for 2024/25 that was made in the 2023/24 Federal Budget.

Superannuation guarantee change for the 2024/25 financial year

Although not part of this year’s Federal Budget, the compulsory superannuation guarantee that businesses must pay to their eligible staff is scheduled to increase from 11% to 11.5% of ordinary time earnings from July 1, 2024.

If you would like to discuss any of the information above further, please contact your accountant or advisor on 03 8419 9800.

This content has been prepared by Wilson Pateras to further our commitment to proactive services and advice for our clients, by providing current information and events. Any advice is of a general nature only and does not take into account your personal objectives or financial situation. Before making any decision, you should consider your particular circumstances and whether the information is suitable to your needs including by seeking professional advice. You should also read any relevant disclosure documents. Whilst every effort has been made to verify the accuracy of this information, Wilson Pateras, its officers, employees and agents disclaim all liability, to the extent permissible by law, for any error, inaccuracy in, or omission from, the information contained above including any loss or damage suffered by any person directly or indirectly through relying on this information. Liability limited by a scheme approved under Professional Standards Legislation. 

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