
2025 is shaping up to be a pivotal year for businesses and not-for-profits (NFPs) in Australia, particularly as it coincides with a federal election. Key legislative changes and proposed policies from both the Government and the Opposition will impact a wide range of sectors.
Staying informed and proactive is critical to navigating these shifts successfully. Below are ten significant issues we have identified for the months ahead.
1. Expanded Mental Health Support for Small Businesses
The Government has allocated $10.8 million over 18 months to programs like NewAccess for Small Business Owners and the Small Business Debt Helpline. These free and confidential services will provide tailored support for financial and mental health challenges faced by business owners.
Action/Impact:
Take full advantage of these programs while funding is available.
2. Governance and Ethical Use of AI
AI technologies will continue revolutionising our work over the coming year and present significant ethical and governance risks. The Australian Government is considering mandatory regulations for high-risk AI applications. Resources like the AICD Director’s Guide to AI Governance offer practical strategies to manage these challenges.
Action/Impact:
Boards should prioritise implementing governance frameworks to ensure the responsible use of AI. Consider forming committees to assess risks and opportunities associated with AI adoption.
3. Cybersecurity and Supply Chain Resilience
As supply chain attacks rise, all organisations are advised to focus on compliance and security.
Action/Impact:
Strengthen third-party relationships and invest in technologies that bolster supply chain security. Regularly review vendor risk management strategies. Engage the services of an IT cybersecurity professional to get the best advice and understand where you may be vulnerable and how to mitigate your risks.
4. Changes to Fringe Benefits Tax (FBT) for PHEVs
Starting April 2025, plug-in hybrid electric vehicles (PHEVs) will no longer qualify for FBT exemptions as low-emission vehicles. Businesses and NFPs using PHEVs must act quickly to secure binding agreements before this deadline to maintain exemptions.
Action/Impact:
Review vehicle contracts immediately to lock in exemptions. Evaluate alternative sustainable fleet options.
5. New Aged Care Act Commencing 1 July 2025
The new Aged Care Act introduces a rights-based framework emphasising simpler access, greater choice, and stronger protections for aged care recipients.
Action/Impact:
If your organisation operates in the aged care sector, review policies and procedures to ensure compliance with the Act’s requirements. Consider additional training for staff to align with the new framework. The Federal Government has also recently announced The Support at Home and new Aged Care Act Transition Support 2024-25 Grant Opportunity (GO7421) designed to provide $10,000 for upgrading IT systems.
6. Policy Shifts in Green Jobs and Energy Transition
The Government will continue to expand support for green jobs across the energy sector, offering funding to employers engaged in tasks like solar panel installation. This aligns with Australia’s sustainability goals, including plans to build 1.2 million homes over five years.
Action/Impact:
Explore funding opportunities for green projects and assess workforce needs to align with energy transition goals.
7. Apprenticeship Incentives to Address Workforce Gaps
Prime Minister recently announced an election policy of a $10,000 cash bonus available for apprentices in residential construction and clean energy sectors starting 1 July 2025. This initiative aims to address critical workforce shortages while promoting sustainability.
Action/Impact:
This policy will depend on whether the Government is returned post-election.
8. Instant Asset Write-Off Threshold
The Coalition has proposed increasing the Instant Asset Write-Off Threshold from $20,000 to $30,000, though it is unclear whether the Government will match this policy. This change could provide small businesses additional opportunities to invest in capital assets.
Action/Impact:
Small business owners should monitor developments closely. Consider deferring major purchases until there is more clarity regarding the potential threshold increase post Federal election.
9. Wage Theft Penalties
From January 2025, the criminalisation of wage theft introduces penalties of up to 10 years in prison and fines exceeding $7.8 million for companies. Small businesses with fewer than 15 employees will not face prosecution if they adhere to a yet-to-be-finalized wage compliance code.
Action/Impact:
Ensure payroll systems are accurate and compliant. Monitor developments on the wage compliance code and align practices accordingly. Software such as Deputy and Employment Hero can help systemise your payroll particularly around award interpretation. Our team work closely with clients to support their compliance in this area.
10. Tax Deductions for Dining and Entertainment
The Coalition has proposed a tax deduction of up to $20,000 for dining and entertainment expenses for small businesses with turnover under $10 million. Alcohol expenses are excluded.
Action/Impact:
If implemented, this policy could boost spending in hospitality and enhance staff/client engagement opportunities.
Preparing for What’s Ahead
To thrive in 2025, businesses and NFPs must take a proactive approach. Preparation is key, from leveraging potential tax breaks to addressing digital transformation and workforce gaps. Begin assessing how these changes might impact your organisation and develop strategic plans to stay ahead of the curve.
Engaging with industry experts like Next Dimension Accounting and communicating with stakeholders will ensure you remain agile in a dynamic operating environment.