Are you spending the right amount on IT?
Updated 26 March 2026
Most companies overspend on infrastructure and underspend on security. Get a recommended IT budget based on your company size, industry, and revenue - benchmarked against real industry data.
Company Details
Annual revenue or total operating budget
Your total annual IT expenditure
Industry benchmark
9.6% of revenue
Recommended IT Budget
$480k
You are currently underspending by $180,000 (38%). Your current spend is 6.0% of revenue.
Current IT Spend
$300k
6.0% of annual revenue
Variance from Benchmark
-$180k
38% underspending
Recommended Budget Breakdown
Current Spend
Recommended
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What percentage of revenue should be spent on IT?
IT spending benchmarks vary by industry and company size. Startups typically spend 10-15% of revenue on IT, while large enterprises spend 4-6%. Financial services and healthcare companies spend more (8-12%) due to compliance requirements. Technology companies typically spend 8-10%.
What is the typical IT budget breakdown by category?
A well-structured IT budget allocates roughly: Personnel 30%, Software/SaaS 28%, Infrastructure 22%, Security 12%, Support and Maintenance 8%. Many organisations overspend on infrastructure and underspend on security, which is increasingly the higher-risk imbalance.
How much should a small business spend on IT?
Small businesses (under 50 employees) typically spend 6-15% of revenue on IT. The wide range reflects how IT-intensive the business model is. A professional services firm might spend 10-12% while a traditional retailer may spend 3-5%.
How much should be allocated to cybersecurity?
Security should represent 10-15% of the total IT budget. Many organisations fall below 8%, which creates meaningful risk. Post-breach, security spend often jumps to 20-25% of IT budget. It is far cheaper to allocate adequately than to remediate an incident.
What drives IT budget growth?
The main drivers of IT budget growth are: SaaS subscription creep (5-15% annual increase without active management), security investment requirements, cloud migration costs, compliance obligations, and the growing cost of technical debt remediation.
How do I optimise my IT budget?
Start with a SaaS audit to eliminate unused licences. Benchmark infrastructure costs against cloud alternatives. Centralise vendor negotiations. Shift from reactive to proactive security investment. Prioritise projects that reduce technical debt and operational overhead.