Treasurer Jim Chalmers has delivered the 2026–27 Federal Budget against a backdrop of higher inflation (driven partly by the Middle East conflict), rising fuel prices, and subdued productivity growth.
It includes some of the most significant tax reforms in decades, with big changes to Capital Gains Tax (CGT), negative gearing and discretionary trusts, plus targeted cost-of-living relief for individuals and small businesses.
Budget snapshot
Major tax reforms + key dates
Capital Gains Tax (CGT) – from 1 July 2027
- 50% CGT discount is replaced by cost base indexation (CPI) for assets held > 12 months
- 30% minimum tax applies to net capital gains – affects individuals, trusts and partnerships
- Pre-1985 (pre-CGT) assets will also be subject to CGT on gains from 1 July 2027
- Investors in new residential builds may choose the old 50% discount or new indexation method
- Transitional relief: gains before 1 July 2027 stay under current rules
Negative gearing (residential property) – from 1 July 2027
- Losses on established residential properties purchased after 7:30 pm AEST 12 May 2026 can only be used against rental income or gains from other residential properties
- Properties owned at time of announcement won’t be affected by new rules until sold
- New residential builds remain fully eligible for negative gearing
Discretionary trust minimum tax – from 1 July 2028
- Trustees pay a minimum 30% tax on all taxable income of discretionary trusts
- Beneficiaries receive non-refundable tax credits for tax paid at trustee level
- Excluded: fixed trusts, superannuation funds, deceased estates, charitable trusts, primary production income
- Roll-over relief available for 3 years from 1 July 2027 for restructuring into a company or fixed trust
Individuals
Business + corporate
Other key measures
This summary is for general information only and isn’t tax or financial advice. Some measures are still proposals and subject to legislation. Get in touch with our team through what it could mean for you.
