Three CGT Changes Every Asset Holder Needs to Know Before 1 July 2027
Australia's capital gains tax rules are changing, and if you hold business assets, investment properties, or other investments, they will affect you.
Back in June, Parliament passed significant changes to the CGT 50% discount that most Australians have relied on since 1999. With the new rules set to take effect from 1 July 2027, now is the time to understand what's coming.
In our latest video, we break down the three key things you need to know about the CGT changes, and what they could mean for your assets and future planning.
The CGT Discount Is Out; Indexation Is In
For over two decades, individuals, trusts, and partnerships who held assets for more than 12 months could apply a 50% discount to their capital gain. That's changing.
From 1 July 2027, we're moving to an indexation method. Instead of discounting your gain, your cost base will be adjusted each year in line with inflation. When you sell, you'll pay tax on the difference between your sale price and this indexed cost base.
A New 30% Minimum Tax on Capital Gains
Here's where things get interesting for those who've been strategic about timing asset sales.
If you've ever planned to sell assets during a low-income year or in retirement to minimise tax, the new 30% minimum tax on capital gains could significantly change your strategy.
Watch the video to learn why this matters and who may be exempt.
It's Not Retrospective (Finally, Some Good News)
The new rules apply from 1 July 2027, not before. This means you can still access the 50% CGT discount for growth up to 30 June 2027.
If you hold assets that span both periods, you may need to use both methods to calculate your capital gain.
The Details Are Still Being Finalised
Not everything is locked in yet. On 14 October, Parliament introduced a second bill that addresses finer details, including how trusts will apply the indexation method and the rules around exemptions for new residential property.
Before making any major decisions, it's important to wait until the full picture is clear.
If you're an asset holder, whether that's a medical practice, investment property, or other investments, this is essential viewing.
Questions About How This Affects You?
If you're concerned about how these changes could affect your assets, or want to discuss timing and strategies for future sales, we're here to help.
Important information: This article contains general information only and does not constitute tax, financial, or legal advice. The legislation is still being finalised, and individual circumstances should be considered before taking action.
