Explore the Negative Gearing Changes 2026 and what they could mean for Australian property investors, including potential tax impacts, rental property deductions, investment returns and future property strategies.
General information only. This article explains publicly announced tax measures and is general information, not tax advice. Strawberry Finance is a credit assistance provider and is not a registered tax agent. Your own position depends on your circumstances, and some measures below remain subject to legislation and may change. Please speak with your accountant or a registered tax agent before acting. Correct as at September 2026.
The capital gains tax changes 2027 announced in the May 2026 Federal Budget propose replacing the 50 per cent CGT discount with a cost base indexation method, together with a 30 per cent minimum tax on affected net capital gains, from 1 July 2027. Unlike the negative gearing measure, which is limited to residential property, the CGT reform is broader and is proposed to apply to CGT assets more generally. For Perth investors sitting on substantial paper gains after several years of strong growth, the capital gains tax changes 2027 raise a practical question about timing and structure. These measures remain subject to legislation and may change before commencement, so treat what follows as an explanation of what has been announced rather than a settled position.
Under the current system, an individual who has held an asset for more than twelve months generally pays tax on half the nominal gain. The capital gains tax changes 2027 replace that mechanism with one based on inflation. The headline elements announced are:
The CGT cost base indexation property method is not new to Australian tax – a version of it applied before 1999 – but it produces a different result from the discount in ways that depend heavily on the individual case. Indexation works by increasing the cost base of the asset in line with movements in the consumer price index over the holding period, so that the portion of the gain attributable purely to inflation is excluded from tax. Whether that leaves an investor better or worse off than the 50 per cent discount turns on two variables above all: how long the asset was held, and how strong the real gain was relative to inflation. An asset held for a long period during a low-growth, high-inflation stretch may fare comparatively well under indexation. An asset held for a shorter period through a sharp price run – which describes a great many Perth investment properties bought since 2021 – may not. Because the CGT cost base indexation property calculation is genuinely case specific, and because the transitional treatment of pre-2027 gains matters enormously to the outcome, this is a calculation to have your accountant run on your actual figures rather than one to estimate from a general article.
Alongside indexation, a 30 per cent minimum tax capital gains floor has been proposed for affected net gains. The practical points to understand:
The selling investment property Perth tax conversation has become more time sensitive than it was a year ago, though not in a way that should push anyone into a rushed sale. Perth values rose strongly through 2024 and 2025 and, on REIWA figures, the median house price reached roughly $938,000 by the end of June 2026 before growth eased through the second half of the year. Many local investors are therefore holding significant unrealised gains at exactly the moment the rules governing those gains are being redrawn. That combination invites a genuine planning conversation with your accountant about whether your intended holding period still makes sense, how the transitional rules treat gains already accrued, and whether any capital losses elsewhere in your position could be used. What it should not invite is selling a good asset for tax reasons alone. A property that suits your strategy, is well tenanted and is comfortably held is usually still worth holding. Where the selling investment property Perth tax position does point toward a sale, the lending side needs attention too – particularly if the property is cross-collateralised with others, which can complicate a sale considerably and is worth untangling well in advance.
With the CGT discount replaced Australia wide from the proposed start date, the strategic question for Perth investors is less about any single property and more about how a portfolio is arranged. Three structural issues are worth reviewing now, independent of how the legislation finally lands. The first is cross-collateralisation. Where several properties secure the same loans, selling one requires the lender to reassess the whole position, which removes flexibility at precisely the moment flexibility is valuable. The second is loan pricing. Investors who have not reviewed their rates in two or more years are frequently paying above what a comparable loan costs today, and on a portfolio that difference compounds. The third is ownership structure, which is squarely an accountant question but has lending consequences, since different entities are assessed differently by different lenders. Strawberry Finance can address the lending elements across more than 40 lenders, working alongside your accountant so that whatever they advise about the CGT discount replaced Australia wide reform, your loans do not stand in the way of acting on it.
No. The measures were announced in the May 2026 Federal Budget and are proposed to commence from 1 July 2027, subject to legislation. The final design could differ from what was announced. This is one of the main reasons we would encourage you to plan with your accountant rather than act on the basis of announced measures alone. For current guidance, refer to ato.gov.au.
It genuinely depends on the individual case. Indexation excludes the inflation component of a gain, so the result turns on your holding period and how strong the real gain was relative to CPI over that time. Shorter holdings through a period of rapid price growth, which describes many Perth purchases since 2021, tend to compare less favourably. Your accountant can model your actual figures, which is the only reliable way to answer this.
Transitional arrangements have been announced so that the new method applies to gains accrued from the commencement date rather than retrospectively to the full holding period. The detail of how that split is calculated matters a great deal to the outcome and is exactly the sort of thing that can shift as legislation is drafted. Please have your accountant confirm the current position before relying on it.
The main residence exemption was not announced as changing. A property that has been your principal place of residence throughout your ownership is generally exempt from CGT under existing rules. Where a property has been partly rented, or was your home for only part of the period, the position is more involved and should be checked with your accountant.
We would not suggest a timeline for you, and neither should any article. Selling a well-performing asset for tax reasons alone often costs more than it saves once selling costs, buying costs and lost growth are counted. The sensible sequence is to have your accountant model your specific position, decide on that basis, and then deal with the lending side. If a sale is the outcome, we can make sure the loan structure does not obstruct it.
We do the lending, they do the tax. In practice that means we review whether your investment loans are competitively priced, separate cross-collateralised securities so individual properties can be sold without disturbing the rest, and structure new borrowing so it preserves your options. Director Sahil Saini brings a commerce background alongside his finance broking accreditation, which makes those conversations with your accountant straightforward. Call 0457 133 453.
The information in this article is general in nature and does not take into account your objectives, financial situation or needs. It is not tax, legal or financial advice. Strawberry Finance is a credit assistance provider and is not a registered tax agent – for advice about your own tax position, please consult your accountant or a registered tax agent, or refer to ato.gov.au. Measures described may be proposed or subject to legislation and could change. Lending is subject to lender credit criteria, terms, conditions and fees. Correct as at September 2026.
Explore the Negative Gearing Changes 2026 and what they could mean for Australian property investors, including potential tax impacts, rental property deductions, investment returns and future property strategies.
Understand the Capital Gains Tax Changes 2027 and what they could mean for Australian property investors, including potential impacts on CGT, investment returns, tax planning and future property strategies.
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