Changes to Australia’s property tax policies are featured in this year’s Federal Budget, which will have a significant impact on property investors.
A range of initiatives are designed to provide cost of living relief to support first home buyers, drive investors towards the new build housing market, and improve housing supply and affordability across Australia. The main changes are to capital gains tax (CGT) and negative gearing.
Regarding capital gains tax, the new budget will:
- Replace the 50% CGT discount with an indexed discount based on inflation.
- Introduce a minimum 30% tax on gains from 1 July 2027.
- Apply CGT reforms to gains arising after 1 July 2027.
- Allow investors in new builds to choose the 50% CGT discount or the new arrangements.
Regarding negative gearing, the new budget will:
- Limit negative gearing to new builds from 1 July 2027.
- Not change the existing arrangements for all properties held before Budget night.
- Allow investors who buy new builds to deduct losses from other income such as salary or wages.
- Allow investors who buy established housing after Budget night to deduct losses against residential property income.
- Prevent investors who buy established housing after Budget night from deducting losses against other income such as salary or wages.
- Allow investors who buy established housing after Budget night to carry forward unused losses to future years.
You can click here to read the 2026-2027 Australian Federal Budget in full. And if you are thinking of investing in property, we suggest you book a time to chat with our property experts.
Chat to us about how a property advocate can help you sell or buy in the current market with confidence. Investment buyers can receive invaluable support and guidance through our Buyers Advocacy Service, and for landlords who are selling, our Vendor Advocacy Service helps vendors achieve outstanding results.
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By Wendy Chamberlain
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