14/05/2026
📊 BUDGET 2026/27 📊
Biggest Impact for Property Investors =
CGT and Negative Gearing.
🔴 Capital gains tax changes 🔴
The existing 50 per cent capital gains tax discount will be replaced with an inflation-adjusted method from July 2027. From then, any gain will be taxed at minimum rate of 30 per cent.
All assets (including housing) will receive the current 50 per cent discount on any capital gain until 1 July 2027, before switching to a pre-1999 inflation-indexation model for gains made after 1 July 2027. Investors who purchase new dwellings will have the option of using either the 50 per cent discount or the inflation-indexation method at the time of sale.
Investors who own a property pre-Budget night but sell at some point after 1 July 2027 will apply the 50 per cent method on gains made prior to 1 July 2027, and then the inflation model on any gains made after that. It would be wise for investors to have their properties valued at this time to have a cost base to work from.
The introduction of the minimum tax rate will reduce the benefit of taxpayers deferring capital gains realisation to years where their marginal tax rates are low. New house builds that elect to use the 50 per cent discount option will be exempt.
🔴 Negative gearing 🔴
The ability to negative gear a residential property and offset against other income will be limited to new dwellings from July 2027.
Investors that owned a property prior to Budget Night (including where a contract has been entered into but has not yet settled), will not be impacted by the change and will be able to continue to negative gear those properties and offset this against their other income.
A transitional measure will be in place for established dwellings acquired after Budget Night whereby they can be negatively geared and offset against other income until 1 July 2027, but not after that.
However, it is worth noting post July 2027 when an investor has excess losses on existing residential investment properties (purchased after Budget Night), they will be able to carry forward that excess to offset residential property income in future years.
Commercial property and other asset classes, such as shares, will remain subject to existing arrangements.
