The 2026/27 Federal Budget landed with a thud. Negative gearing is being tightened, the CGT discount is being overhauled, and discretionary trusts are in the firing line. Add to that the end of card surcharges, a wind-back of the EV tax exemption, and looming SMSF deadlines and there is a lot to get across before 30 June and beyond.
The Federal Budget just changed the investment property rulebook
If you own investment property or are thinking about buying, the 2026/27 Budget proposals are significant. From 1 July 2027, negative gearing on established residential properties will be restricted for new purchases. Losses will no longer be freely deductible against salary or other income.
The CGT discount is also being replaced. Instead of a flat 50% reduction on gains, a cost-base indexation model and a 30% minimum tax will apply from the same date. Critically, gains that accrued before 1 July 2027 are still protected, but you will need a market valuation of your assets at that date.
| Already own a property or exchanged before Budget night (12 May 2026)? Grandfathering applies and your existing treatment continues. But if you are considering purchasing or restructuring, the timing matters enormously. |
Our Federal Budget Tax Updates PDF breaks down each measure in detail, including a worked example showing the real tax difference under the new CGT rules.
Click here to download the PDF: Federal Budget Tax Update – PDF
Discretionary trusts: a fundamental shift
From 1 July 2028, a 30% minimum tax is proposed on the income of discretionary trusts. For business owners who distribute profits to family members on lower tax rates, this is a material change and in some cases could more than double the tax paid on the same income.
Some exemptions apply (super funds, charitable trusts, primary production income and others), and three years of roll-over relief is available for those looking to restructure. But the start date of 2028 is closer than it sounds.
| Now is the time to model your options, not in 2028. Federal Budget Tax Updates PDF includes a worked example comparing tax outcomes before and after the changes. |
Card surcharges end 1 October 2026
The RBA has confirmed the ban on surcharges across eftpos, Mastercard and Visa from 1 October 2026. Australians pay an estimated .6 billion in surcharges annually and that is ending. Businesses that have been offsetting merchant fees through surcharges will need a new approach.
Before October, businesses should:
- Review current merchant fees and surcharge reliance
- Negotiate updated pricing with payment providers
- Remove surcharge signage and update checkout systems
- Revisit pricing to ensure margins are maintained
The full PDF walks through the complete reform package, including what the ACCC oversight means in practice.
EV FBT exemption: act before 31 March 2027
The full FBT exemption for electric vehicles continues until 31 March 2027. After that, a three-stage wind-back applies. EVs under 5,000 will retain the full exemption into Phase 2, but pricier vehicles will see a reduced concession from April 2027, and a flat 25% discount for all from April 2029.
| If you have been considering an EV through a novated lease or salary packaging, the clock is ticking. Existing leases are expected to be grandfathered, but the draft legislation will determine the final scope. |
SMSF trustees: critical steps before 30 June
The financial year end brings a tight checklist for SMSF trustees. Key items:
- Minimum pension payments must be made by 30 June 2026
- Contributions must land in the fund’s bank account by 30 June. Allow extra time for inter-bank transfers
- Consider carry-forward concessional contributions if your balance is under $500,000
- All assets must be valued at market value as at 30 June
- Trustee minutes, pension documents and related-party arrangements must be in order
Contribution caps are also increasing from 1 July 2026: concessional contributions rise to 2,500 and non-concessional to 30,000. The general transfer balance cap increases to .1 million.
Want the full detail?
Download the Federal Budget Tax Update PDF for the complete analysis, including worked examples, compliance checklists and practical next steps for your situation.
Federal Budget Tax Update – PDF
Every client’s situation is different and the right response to these changes will depend on your personal and business circumstances. Contact our team today and we will review your position, run tailored projections and make sure you are ready for what’s coming.
