How to Calculate Your IT Budget for 2026

The IT Budget Formula

For most Indian SMEs, IT spend should be 3-7% of revenue. For companies with 50-200 employees, a practical approach is per-employee budgeting.

Per-Employee IT Cost

Category	Monthly per Employee	Annual per Employee
Hardware (amortised)	₹2,000-3,000	₹24,000-36,000
Software & SaaS	₹800-1,500	₹9,600-18,000
Internet & connectivity	₹500-800	₹6,000-9,600
Support & maintenance	₹500-1,000	₹6,000-12,000
Contingency (10%)	₹400-600	₹4,800-7,200
Total	₹4,200-6,900	₹50,400-82,800

Budget Calculation Example

For a 50-person company: ₹5,000/employee/month × 50 employees × 12 months = ₹30,00,000 annual IT budget. Break this into: hardware (40%), software (25%), infrastructure (20%), contingency (15%).

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