Insights · Planning · 31 October 2026

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How to build a small business budget you will actually use

A budget is your plan for the year in numbers. Done simply, it tells you what sales you need, what you can afford to spend and whether you are on track each month.

Five steps

1. Start from last year's actuals. Pull a 12-month profit and loss by month to see seasonality.
2. Set sales targets by product, service or customer type, by month. Use real drivers: jobs, average price, conversion.
3. Plan direct costs and margin. Check your pricing: markup vs margin.
4. Plan overheads, including wages increases, super at 12%, insurance, software and rent.
5. Add tax and loan repayments so the budget links to cash: tax to set aside.

Make it useful

• Load it into your accounting software so you get budget vs actual every month.
• Review it monthly in 30 minutes: what is off, why, and what you will do.
• Pair it with a rolling cash flow forecast: profit and cash are different, see cash flow vs profit.
• Re-forecast mid-year rather than abandoning it.

Want it built with you? That is part of our fractional CFO service.

Quick answers

What should a small business budget include?

Monthly sales targets, direct costs, overheads, tax and loan repayments, built from last year's actuals.

How often should I review my budget?

Monthly, comparing budget to actual, and re-forecast mid-year.

Related reading: Break-even analysis · Ten KPIs to track

Sources

• business.gov.au: Guide to managing cash flow
• ATO: Super guarantee rates

General information only. This article does not take into account your circumstances and is not tax, legal or financial advice. Rates and rules change; check the sources above and get advice for your business before acting.