Budget 2026-2027
Last night's Federal Budget was a significant one. Treasurer Jim Chalmers announced a broad package of tax reforms that will affect individuals, property investors, business owners, and trust beneficiaries. We have put together this quick summary so you can understand the key changes at a glance.
The full picture is more detailed than any brief summary can capture, so we have also prepared a more comprehensive guide that we are happy to walk through with you. For now, here is what matters most:
$1,000 Instant Tax Deduction (from 1 July 2026): If you earn income from work, you can now
claim a flat $1,000 work-related deduction without receipts. If you normally claim more, you can continue doing so in the usual way.
$250 Working Australians Tax Offset (from 2027–28): A permanent annual tax offset for all working Australians — wages, salary and sole trader income. The benefit first applies when your 2027–28 return is lodged.
Capital Gains Tax — 50% discount replaced (from 1 July 2027): The CGT discount is being replaced by cost base indexation plus a 30% minimum tax on net gains. Assets sold before 1 July 2027 are unaffected. This is a major change for property investors, business owners and trust beneficiaries.
Negative Gearing — existing properties protected: If you already own a negatively geared investment property, nothing changes for you. Properties acquired after 7:30pm on 12 May 2026 will face restricted deductions from 1 July 2027. New builds remain fully exempt.
Trust Distributions — 30% minimum tax (from 1 July 2028): A new minimum tax on discretionary trust distributions is proposed. Legislation has not yet been released. This is one to watch closely over the coming months.
Superannuation — three changes from 1 July 2026: Earnings on balances above $3 million are now taxed at 30%. The transfer balance cap rises to $2.1 million. Employers must move to payday super — contributions paid at the same time as wages.
Instant Asset Write-Off — now permanent: The $20,000 instant asset write-off for small businesses (turnover under $10 million) is now a permanent feature of the tax system.
Loss Carry-Back for Companies (from 1 July 2026): Companies with global turnover under $1 billion can offset a current year loss against tax paid in either of the two previous years — potentially generating a cash refund.
Fuel Excise — temporary cut ends 30 June 2026: The 26.3 cents per litre fuel excise reduction expires on 30 June 2026. Full excise rates return from 1 July 2026.
Many of these changes interact with each other, and the right response for your situation will depend on your specific circumstances. We are available to talk through what matters most for you — whether that is a property you are considering, a business structure review, or a superannuation question ahead of 1 July.
We will also be reaching out individually to clients we believe are most directly affected. In the meantime, please do not wait to hear from us if you would like to talk.