Back in June, we told you to sit tight. The Budget tax reforms were proposals, not law, and the goalposts were still moving. We called it Budget limbo.
Limbo’s over for CGT.
That gives you a runway of about nine months. Not to panic. To get organised.
In this article:
- What’s changed with capital gains tax
- The assets affected
- What’s not affected
- The line in the sand: 1 July 2027
- Two ways to work out your 1 July 2027 value
- What to do before 30 June 2027
- One thing not to do
- The old playbook is out
- Frequently asked questions
What’s changed with capital gains tax
For 25 years, the deal was simple. Hold an asset for more than 12 months, sell it, and only half your gain got taxed.
From 1 July 2027, that 50% discount is gone. Two things replace it:
- An inflation adjustment. Your purchase price gets lifted by inflation (the technical name is cost base indexation), so you’re only taxed on the gain above inflation.
- A 30% minimum tax on gains. Even if you sell in a year when your income is low or nil, the gain is taxed at no less than 30%.
The assets affected
It’s a wide net. Shares, ETFs, managed funds, investment property, business assets and crypto are all in. So are assets bought before 1985, which have been CGT-free until now. Their growth from 1 July 2027 becomes taxable.
What’s not affected
- Your family home. Still CGT-free.
- Your super. Super funds keep their own CGT rules.
- New builds. Investors in newly built homes can choose between the old 50% discount and the new rules.
- Small business concessions. These continue, and the turnover threshold for the 50% active asset reduction rises from $2 million to $10 million.
- People on income support. If you receive the Age Pension or another government income support payment in the year you sell, the 30% minimum tax doesn’t apply. The 50% discount still applies.
Shares
ETFs
Managed funds
Investment property
Business assets
Crypto
Pre-1985 assets
Your family home
Still CGT-free.
Your super
Keeps its own CGT rules.
New builds
Choose the old 50% discount or the new rules.
Small business concessions
Continue. 50% active asset reduction threshold rises from $2m to $10m turnover.
People on income support
Exempt from the 30% minimum tax. The 50% discount still goes.
The line in the sand: 1 July 2027
Here’s the good news. Gains built up before 1 July 2027 keep the 50% discount, whenever you sell. That could be next year or in 2045. The old rules stay locked in for that slice.
Behind the scenes, the tax office treats 1 July 2027 as a line in the sand. Growth on one side, old rules. Growth on the other, new rules.
You may hear this called a “deemed disposal”. On paper, the tax office treats you as if you sold everything on 1 July 2027 and bought it straight back at that day’s value. It’s a paper exercise only.
You don’t get a tax bill on the day. Nothing goes in your tax return. It sits quietly in the background until you sell, and then the two slices get worked out.
The catch is the evidence. When you do sell, you’ll need to show what the asset was worth on 1 July 2027.
Think of it as a photo of your finances on that one day. And you can’t go back and take the photo later.
Two ways to work out your 1 July 2027 value
The government’s explainer gives you two options. You choose in your tax return in the year you sell.
Option 1: A valuation as at 1 July 2027
- Listed shares and ETFs: the quoted market price on the day. You can get this from your online trading account or your financial adviser.
- Investment property: a property valuation, done around 1 July 2027.
- A business or unlisted investments: a business valuation, with the evidence behind the number.
Option 2: The government’s formula
If you don’t have a valuation, a formula estimates your 1 July 2027 value when you eventually sell. It works off your asset’s average growth rate across the whole time you’ve owned it.
In other words, it assumes your asset grew at the same steady pace every year. Property and businesses rarely behave that politely.
The formula hasn’t been released yet. The ATO says it will provide tools to do the sums.
The takeaway: a proper valuation gives you the choice between the two. No valuation, no choice.
Old rules
Keep the 50% CGT discount, no matter when you sell.
New rules
Discount goes. Inflation indexation plus a 30% minimum tax on gains.
Listed shares and ETFs
The quoted market price on the day.
Investment property
A property valuation, done around 1 July 2027.
Business and unlisted assets
A business valuation, with the evidence behind the number.
The government formula
Estimates the value when you sell. Assumes steady growth.
What to do before 30 June 2027
- List everything you own outside super. Shares, ETFs, managed funds, property, business interests, crypto.
- Dig out your purchase records. Dates, prices, costs. You’ll need them for both slices of the gain.
- If you own property or a business, book your valuer early. A lot of investors will want the same thing in the same week.
- If you’re thinking of selling something with a big gain, talk to us and your accountant first. Timing matters more than ever.
- Review how your investments are owned. Any new money you invest from here deserves a proper think about structure before it goes in.
One thing not to do
Don’t make a move purely to save tax. Tax is always the secondary reason, never the main event. A good investment with a bit more tax still beats a poor investment with a tax break.
We’d rather you make money and send a touch extra to the ATO than make nothing and send them nothing.
Ready to talk it through
You’ve got until 30 June 2027 to get your records straight and your valuations lined up. If you’d like a hand working out what it all means for you, book a free 20-minute introductory phone call with our Geelong team.
Stay Beautiful!
John Manserra
Certified Financial Planner®, Director
Apex Advice – Geelong Financial Advisers and Geelong Mortgage Brokers for business owners and professionals who want to make work a choice before you’re 67. Book a 15 minute chat here.
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Frequently asked questions
The new capital gains tax rules start on 1 July 2027. The legislation received royal assent on 26 June 2026, so it’s now law, not a proposal. Any sale before 1 July 2027 is taxed entirely under the current rules, including the 50% discount for assets held longer than 12 months.
No, not for the growth you’ve already built up. Gains up to 30 June 2027 keep the 50% discount, no matter when you sell. Only growth from 1 July 2027 onwards falls under the new rules. That’s why having evidence of your asset’s value at 1 July 2027 is so important.
No. The tax office draws a line through your assets on that date, but nothing is payable and nothing goes in your tax return. The two slices of your gain are only calculated in the year you sell. If you never sell, no capital gains tax is triggered.
Almost everything you own outside super and your family home. That includes shares, ETFs, managed funds, investment property, business assets and crypto. Assets bought before 1985, which have been CGT-free until now, are also caught for growth from 1 July 2027. New builds and small business assets get special treatment.
It’s not compulsory, but it’s worth serious thought. A valuation done around 1 July 2027 gives you hard evidence and lets you choose between your valuation and the government’s formula when you sell. Without one, the formula is your only option, and it assumes steady growth every year. Valuers will be busy, so book early.
It’s how the tax office separates your old gains from your new ones. On paper, you’re treated as having sold each asset on 1 July 2027 and bought it back at that day’s value. No tax is payable at that point and nothing goes in your tax return. The two parts of your gain are only worked out in the year you actually sell.
Gains that build up from 1 July 2027 are taxed at no less than 30%, even if your other income is low. In the government’s own example, someone earning $25,000 who makes a $10,000 gain pays $3,000 in tax on it instead of $1,400. People receiving the Age Pension or other government income support in the year they sell are exempt from the minimum.
Not automatically. Your gains up to that date keep the 50% discount anyway, so there’s no cliff to beat. Selling early can mean paying tax sooner and wearing transaction costs for no benefit. If you were already planning to sell, timing is worth a conversation with your adviser and accountant before you act.
No. Super funds, including SMSFs, keep their existing capital gains tax treatment. That’s one reason super is getting a fresh look as a home for high-growth investments. Contribution caps and access rules still apply, so it needs to be weighed up as part of your overall plan.
Important:
This is not tax advice. The information contained in this article has been provided as general advice only. The contents have been prepared without taking account of your personal objectives, financial situation or needs. You should speak to your financial adviser and accountant before acting on it.
Current at 21 September 2026.