3 Tax changes hitting your business in 2026

The next few months are important. New tax rules are coming in, and if you’re not ready, they could end up costing you. There’s still time to plan and stay ahead of them.

1. ATO interest is no longer tax-deductible

What’s happening:

From 1 July 2025, you can’t claim ATO interest as a deduction anymore. If you’re late paying your tax and get hit with interest, it’s now a straight cost.

Why it matters:

The ATO charges around 11% interest a year on unpaid tax, and it compounds daily.

What to do:

• Log in to the ATO Business Portal and check your balance.
• Set up a payment plan if you owe money. The ATO prefers that over chasing debts.
• Sort out why you fell behind. Late BAS or super payments? Fix that.
• Open a separate bank account for your tax money so it’s always there when you need it.

ATO interest is now one of the most expensive forms of debt you can have. You can't ignore it.

2. The $20,000 instant write-off is ending

What’s changing:

Right now, small businesses can immediately claim assets under $20,000. From 1 July 2026, that drops back to $1,000, meaning you’ll need to depreciate larger purchases over a few years.

Why it matters:

If you buy a new ute, tools, or equipment before June 2026, you can claim the whole amount this year. Buy it later and you’ll wait years to get the same tax benefit.

What counts:

• Work vehicles
• Machinery and tools
• Computers and software
• Office or safety gear

A $20,000 deduction could save you between $5,500 and $9,400 in tax, depending on your rate.

What to do:

• Write down what you’ll need to buy before June 2026.
• Get your quotes ready early.
• Make sure anything you buy is installed and ready for use before 30 June 2026.

And don’t buy something just for a tax deduction. It only helps if it’s something your business actually needs.

3. Bigger super balances will be taxed more

What’s changing:

From 1 July 2026, super balances over $3 million will pay 30% tax on earnings over that amount (up from 15%).

Who this affects:

This mostly impacts business owners and investors with large SMSFs — people who’ve built up significant wealth inside super.

What to do:

• Get updated valuations on everything in your fund.
• Talk with your adviser about whether to withdraw or rebalance assets.
• Consider splitting funds with your spouse to make use of both $3 million caps.
• Work out how much the higher rate will cost you and if it’s worth restructuring.

It only applies to earnings above $3 million, but you’ll want to plan before July 2026.

The ATO is watching the building sector closely

The ATO has set aside $155 million to crack down on cash economy activity and construction is one of their top targets.

They’re looking at:

• Cash payments and missing income
• Off-the-books labour
• Missing PAYG or super contributions
• Incomplete contractor reports (TPAR)

If you’re QBCC licensed:

ATO non-compliance can now affect your licence. They share information with QBCC, which can impact your Minimum Financial Requirements and ability to win work.

What to do:

• Lodge TPAR reports on time.
• Keep digital copies of every invoice and receipt.
• Declare all income — even cash.
• If you’ve made mistakes, make a voluntary disclosure before the ATO calls.

What it all means

If you wait, it’ll cost you.

• ATO interest is no longer deductible.
• The instant write-off drops to $1,000 after June 2026.
• Super earnings over $3 million will be taxed more.
• Construction audits are ramping up.

Now’s the time to get organised.

How FTA Accountants can help

We work with Queensland businesses every day, especially in construction, trades, and agriculture. We understand how cash flow and compliance really work on the ground.

Here’s what we can help with:

• Payment plans and tax provisioning for ATO debts.
• Advice on equipment purchases and timing.
• SMSF reviews and restructuring before the new rules hit.
• Keeping your QBCC reporting and compliance up to date.

We’re here to make things easier and help you stay one step ahead.

Don’t leave it too late

Once these rules start, there’s no going back. Use the next few months to plan and turn these changes into an advantage.

Call (07) 5409 2300 Email info@ftaaccountants.com.au