Treasurer Jim Chalmers' 2026 Budget delivers the most significant shift to Australia's investment tax landscape in a generation.  

There is a lot we don’t like about the proposals, and it appears that there may be many unintended consequences.  We will see how the detail is worked through and how the proposals are adjusted through the consultation period and the drafting of the detailed legislation.   

Although there is plenty more detail, we need to understand and then analyse, here's what we know right now for investors, property owners, and business owners. 

Changes

Capital Gains Tax

The 50% CGT discount will be restricted to newly constructed residential property from 1 July 2027. For shares, commercial property, and established residential, it will be replaced with inflation-based indexation. Gains accrued before that date remain protected under existing rules. 

A new minimum 30% tax rate on capital gains will also apply regardless of your marginal rate, directly targeting deferral strategies into low-income retirement years. 

Pre-CGT assets (acquired before 20 September 1985), previously fully exempt, will have gains accruing from 1 July 2027 brought into the tax net. 

If you hold an investment portfolio, now is the time to review your structure and consider any rebalancing and restructuring before the transition date. 

Negative Gearing

For properties acquired after 7:30 pm on 12 May 2026, losses on established residential property can no longer be offset against wages or business income, only against other rental income or property sale gains. Existing portfolios are grandfathered. New builds retain full deductibility and the 50% CGT discount. 

Discretionary Trusts

From 1 July 2028, trust distributions will attract a minimum 30% tax regardless of the beneficiary's rate, significantly reducing the benefit of income splitting. A three-year restructuring window opens from 1 July 2027, allowing families to move from discretionary trusts to companies or fixed trusts without triggering CGT. If your wealth is held in a family trust, this window is important, and planning should start now. 

Business Measures

On a positive note, loss carry-back for companies up to $1 billion turnover becomes permanent from 1 July 2026, as does the $20,000 instant asset write-off for businesses under $10 million turnover. 

Our Perspective

Like all tax-related strategies, these proposed changes will impact those who fail to plan early. At Rasiah Private, we are reviewing the impact of all existing clients and will be in touch with them individually.