2026-27 Federal Budget
The 2026-27 Federal Budget proposed replacing the 50% CGT discount with cost base indexation and a 30% minimum tax on net capital gains, for assets held more than 12 months. The change applies to sales contracted on or after 1 July 2027.
Check how the 2027 CGT changes affect a specific sale
Use the free checkerAnnounced
12 May 2026
7:30pm AEST, Federal Budget night
Takes effect
1 July 2027
Contract date, not settlement
Status
Proposed
Legislation not yet passed
Under existing rules, individuals and trusts holding an asset for more than 12 months can apply a 50% discount to their capital gain before including it in assessable income.
Under the proposed rules, for assets sold on or after 1 July 2027, the 50% discount is replaced with:
If an asset was purchased before 1 July 2027 and sold after that date, the capital gain is split on a time basis.
Illustrative example only. Not a tax estimate.
A property purchased in January 2022 and sold in January 2030 has an illustrative total gain of $400,000 over 8 years.
Pre-reform portion (Jan 2022 to Jun 2027)
Illustrative gain: $275,000
50% discount applies
Assessable: $137,500
Post-reform portion (Jul 2027 to Jan 2030)
Illustrative gain: $125,000
Indexation + 30% minimum tax
Calculated separately at marginal rate
Numbers are illustrative only. Actual tax position depends on individual circumstances. Confirm with a registered tax agent.
Investors selling newly constructed residential properties can elect on sale to use either the existing 50% discount or the new indexation regime. The election is self-declared and must be made before the sale contract is signed. Confirm the applicable rules and eligibility conditions with a registered tax agent before proceeding.
The main residence exemption is unchanged. No CGT applies to a qualifying main residence on sale.
Complying superannuation funds, including SMSFs, retain the existing one-third CGT discount. The proposed reforms do not apply.
Pensioners and income support recipients are exempt from the proposed 30% minimum tax rate.
The CGT event date is the contract date of sale, not the settlement date. A sale contracted before 1 July 2027 uses current CGT rules, even if settlement occurs after that date.
Under the 2026-27 Federal Budget proposal, the existing 50% CGT discount for assets held more than 12 months will be replaced with cost base indexation and a 30% minimum tax rate on net capital gains. The change applies to sales contracted on or after 1 July 2027.
The proposed effective date is 1 July 2027. The CGT event date is the contract date of sale, not the settlement date. Sales contracted before 1 July 2027 use the current 50% discount rules.
Cost base indexation adjusts the original purchase price for inflation using the Consumer Price Index. The indexed cost base is subtracted from the sale price to determine the taxable gain, instead of applying the 50% discount to the raw gain.
Under the proposed rules, net capital gains on assets held more than 12 months are subject to a 30% minimum tax rate. If the taxpayer's marginal rate already results in a tax liability of 30% or more on the gain, the minimum does not add further tax.
If the sale contract is dated before 1 July 2027, the current rules apply. The 50% CGT discount remains available for assets held more than 12 months.
For assets already held when the reform takes effect, a split applies on sale. Capital growth accrued up to 30 June 2027 retains the existing 50% discount treatment. Growth accrued from 1 July 2027 uses cost base indexation and the 30% minimum tax.
Investors selling newly constructed residential properties can elect to use either the existing 50% discount or the new indexation regime. The election is self-declared and must be made before the sale contract is signed. Confirm the applicable rules with a registered tax agent.
The main residence exemption is unchanged by the proposed reforms. No CGT applies to a qualifying main residence on sale.
Complying superannuation funds, including SMSFs, are not affected by the proposed reforms. They retain the existing one-third CGT discount.
Proposed legislation, effective 1 July 2027. Indicative only. Not tax or financial advice. Confirm with your accountant or registered tax agent. Budget tax reform detail (budget.gov.au)
Brikly tracks contract dates and factors the 2027 changes into your CGT position per property. It won't tell you what to do.
Early access. No financial advice. Just the numbers.