The CGT changes are the most technically complex element of the 2026 tax reforms and the least well understood by everyday Australians. Experts continue to identify anomalies and unintended consequences.

How CGT Worked Before the Budget

Under the previous system, assets held for more than 12 months received a 50% CGT discount. The remaining gain was added to taxable income and taxed at the holder’s marginal rate. With the top marginal rate (including Medicare levy) at 47%, the maximum effective CGT rate was 23.5%. Retirees with low taxable incomes often paid little or no CGT. The 50% CGT discount applied to individuals, trusts and partnerships.^[18]

What Has Changed Under the New Rules

From 1 July 2027, the 50% CGT discount for individuals, trusts and partnerships is replaced with cost base indexation and a 30% minimum tax rate. Investors will no longer receive a fixed 50% discount on nominal capital gains. Instead, taxable gains are calculated after adjusting for inflation, with real gains subject to the 30% minimum tax floor where relevant. Superannuation funds, including SMSFs, were explicitly excluded from the CGT discount changes and retain their existing concessional treatment.^[4]

  CGT Example: Same Shares, Very Different Tax Outcome

  UNDER OLD RULES: Buy $100,000 shares (July 2024), sell for $150,000 (June 2027)

     Gain: $50,000 → 50% discount → Taxable gain: $25,000

     Tax (low-income retiree): Potentially little or no tax

  UNDER NEW RULES: Buy $100,000 shares (July 2027), sell 3 years later for $150,000

     Cost base indexed to $110,000 (inflation-adjusted)

     Gain: $40,000 → Minimum 30% rate → Tax bill: ~$12,000

  Source [7]: Illustrative example adapted from The Adviser Briefing (client-supplied document)

Who Gets Hit Hardest?

Self-funded retirees face a particularly harsh outcome. A pensioner receiving Centrelink payments may be exempt from the new minimum rate regime. A self-funded retiree with the same income but no Centrelink support could face a 32% effective CGT rate — double the 16% marginal rate applying to the rest of their income below $45,000. The only material difference between them is whether the government sends them a cheque.^[7]

CPA Australia estimates the one-off cost of valuing assets before the new rules commence at between $675 million and $825 million, with ongoing compliance costs of up to $542 million per year. Treasury’s own estimate was just $88 million.^[7]

Sources

All sources were accessed in late June and early July 2026. Inline references in the body of this blog correspond to the numbered sources below.

[1] RBA Official Media Release — 5 May 2026 Rate Decision Reserve Bank of Australia. Statement by the Monetary Policy Board. Decision to raise cash rate by 25bp to 4.35%, voted 8-1. rba.gov.au/media-releases/2026/mr-26-12.html

[2] ClearTax.com.au — SMSF Borrowing Banned: What the New Rules Mean for You Overview of LRBA ban announced 23 June 2026, Greens deal, bare trust mechanics, implementation timeline and government figures. cleartax.com.au/tax/news-and-updates/smsf-borrowing-banned

[3] Trading Economics — Australia Interest Rate / RBA June 2026 Summary Unanimous hold at June 2026 meeting; May 2026 Board minutes analysis; ‘not sufficiently restrictive’ assessment. tradingeconomics.com/australia/interest-rate

[4] Hudson Financial Planning — SMSF Property Loan Ban 2026 SMSF CGT exclusion from discount changes confirmed; concessional super tax rates retained; LRBA implementation timeline. hudsonfinancialplanning.com.au

[5] Holding Redlich — Federal Budget 2026-27: Three Tax Changes Reshaping Investment, Trust Structures and Business Planning Authoritative legal analysis of trust reforms including triple-impact on trust-held residential property, testamentary trust exclusions, rollover relief, state stamp duty warnings, and government preference for institutional capital. holdingredlich.com

[6] NAB Business — 2026 Federal Budget: What It Means for Individuals 30% minimum discretionary trust tax announcement; 900,000 family trusts potentially affected; trust exclusions; widely held trust carveout. business.nab.com.au

[7] The Adviser — Industry Briefing, week of 25 June 2026 (client-supplied document) Primary source for lender serviceability update timeline; negative gearing eligibility and cutoff rules; CGT examples and retiree impact; CPA compliance cost estimates; SMSF LRBA ban; ministerial quotes; fairness analysis including $80 vs $255/week holding cost comparison.

[8] ORDE Financial — Servicing Policy Update, 29 June 2026 (via client-supplied document) Full eligibility scenarios for negative gearing: commercial property, equity releases for shares, owner-occupied conversions, new-build scenarios.

[9] Westpac — Credit Policy Update, 29 June 2026 (via client-supplied document) Mandatory broker procedures: separate assessment of negative gearing vs RITD; updated serviceability calculator; ApplyOnline documentation; borrower declarations.

[10] Perpetual Wealth — Federal Budget 2026 Analysis Negative gearing quarantine mechanics; 30% minimum trust tax structure; beneficiary credit treatment; corporate beneficiary rules; recommendation to await final legislation. perpetual.com.au/insights/federal-budget-2026

[11] SuperGuide — Federal Budget 2026 Overview Updated budget overview incorporating 23 June 2026 Greens amendments; SMSF LRBA ban; 83% of CGT discount flowing to top 10% of earners. superguide.com.au

[12] BrokerBros — Australian Federal Budget 2026: What It Means for Interest Rates, Property Investors, Home Loans & the Future of Australian Property Discretionary trust 30% minimum tax; structural shift toward SPVs and corporate structures; lender tightening on trust/company lending. brokerbros.com.au

[13] FINSTREET — Australian Mortgage Lending Outlook 2026: DTI Limits, Trust Lending Changes Macquarie pause on trust lending (early 2026); CBA tightening; trend toward non-bank lenders for trust borrowers; broker strategy implications. finstreet.au

[14] Holding Redlich — Federal Budget 2026-27 (triple-impact analysis) Detailed analysis of the compounding three-layer tax impact on discretionary trust-held residential property: negative gearing quarantine + CGT indexation + 30% trustee minimum tax. holdingredlich.com

[15] Secured Lending — Australia’s New Trust Tax Rules in 2026: What Property Investors Need to Know 30% minimum tax mechanics and effect on low-rate beneficiaries; private lending for restructure funding; rollover window analysis. securedlending.com.au

[16] Latitude Accountants — Negative Gearing Changes 2026: What Investors Need to Know Borrowing capacity reduction estimates of 20–30%; impact by borrower segment (first-time buyers, mum-and-dad investors, developers, high-income earners). latitudeaccountants.com.au

[17] Perpetual Wealth / NAB — Budget Negative Gearing Rules (trust scope) Negative gearing changes apply to individuals, partnerships, companies and most trusts; widely held trusts and superannuation funds excluded. perpetual.com.au / business.nab.com.au

[18] Commonwealth Bank — 2026 Budget: Updated Housing Outlook CGT discount replacement with indexation and 30% minimum; removal of negative gearing equivalent to 90–155bp increase in investor mortgage costs; price growth forecast revised to 3% for Dec 2026. commbank.com.au

[19] Finance Monthly / Aus Investment Properties — How Mortgage Brokers Help Property Investors Maximise Borrowing Power in 2026 APRA 3% serviceability buffer; DTI cap from February 2026; trust income assessment in broker serviceability calculations. finance-monthly.com

[20] Macquarie Bank / Broker Daily — Macquarie Bank to Pause New Lending to Trusts and Companies (30 October 2025) Immediate pause on all new trust and company home loan applications from 31 October 2025; existing loans unaffected; AML Tranche 2 and social media finfluencer cited as reasons. brokerdaily.au

[21] Broker Daily — Macquarie’s Halt on Trust and Company Loans Will ‘Reshape’ Broker Strategies (November 2025) Industry broker reaction; Eva Loisance ‘pushback against loophole-driven lending’; Matt Turner on significance; St. George Bank withdrawal; prediction more lenders will follow. brokerdaily.au

[22] Yahoo Finance / YourLifeChoices — Macquarie Bank’s ‘Bombshell’ Mortgage Move (October 2025) 94% of Macquarie loans through broker channel; Azure Financial Max Harris ‘golden era ending’ quote; ASIC finfluencer crackdown context. au.finance.yahoo.com / yourlifechoices.com.au

[23] Capital Brief — CBA Joins Macquarie in Pulling Back from Trust Lending (January 2026) CBA tightening on trust and company lending post-Macquarie; APRA signalling macro-prudential measures; finfluencer TikTok strategies cited. capitalbrief.com

[24] Aus Investment Properties — What the New Macquarie & CBA Lending Clamp Down Means for Property Investors APRA DTI cap from 1 February 2026: maximum 20% of new loans at DTI >6x; CBA six-month relationship requirement; non-bank lender alternative. ausinvestmentproperties.com.au

[25] Mortgage Professional Australia — Why Have Macquarie, CBA Restricted Brokered Company and Trust Lending? (November 2025) William Xin forecast that trust lending will shift to non-bank lenders; ANZ, NAB, Westpac still lending; regulatory risk weighting increases. mpamag.com

[26] Aussie Home Loans — RBA May 2026 Rate Decision Analysis & Expert Predictions Bank-by-bank rate forecasts (NAB, Westpac, ANZ, CBA); Canstar repayment estimates; 11 lenders cutting variable rates post-May hike. aussie.com.au

[27] Westpac IQ Economics — RBA June 2026 Decision Analysis Post-meeting hawkish language analysis; ‘stronger steer than in recent communication’; Westpac August/September hike forecast. westpaciq.com.au

[28] NexGen Lending / YourLifeChoices — Macquarie Bank Pulls Out of Trust Lending: What It Means for You Trust lending mechanics; Macquarie’s 5.9% market share; 94% broker-originated; AML Tranche 2 context; alternatives for trust borrowers. nexgenlending.com.au

[29] GrowSMSF — SMSF Borrowing Banned: What the Labor-Greens LRBA Deal Means for You Confirms Senate passage (35-25), House agreement (98-39) on 25 June 2026, and Royal Assent on 26 June 2026; confirms 10 August 2026 commencement date; explains contract-exchange protection rule. growsmsf.com.au/smsf-lrba-ban-2026

[30] Hudson Financial Planning — SMSF Property Loan Ban 2026: What the Deadline Means for You Clarifies that protection depends on contract signing date, not loan approval or settlement; SMSF establishment costs and timelines. hudsonfinancialplanning.com.au

[31] iCare Super — SMSF Residential Property LRBA Ban Now Law – 10 August 2026 Deadline Confirmed Confirms Royal Assent granted 26 June 2026 and commencement date of 10 August 2026; practical guidance for trustees, lenders and solicitors working within the compressed timeframe. icaresmsf.com.au

[32] EEA Advisory — What the Proposed LRBA Ban Means for SMSF Investors Explains the ‘business real property’ legal test under section 66 of the SIS Act; confirms residential dwellings do not meet this test; clarifies unleveraged residential purchases remain permitted. eea-advisory.com.au

[33] ClearTax.com.au — SMSF Borrowing Banned: What the New Rules Mean for You (pre-passage version) Early coverage as at 23 June 2026 noting the change was then still proposed; background on LRBA mechanics since 2007. cleartax.com.au

[34] SMSF Adviser — More Details of LRBA Ban But Criticism Keeps Coming SMSF Association criticism of lack of consultation; Treasurer Chalmers’ $50 million fiscal estimate and SMSF market-share figures; SMSF Association policy lead comments on new-build exclusion; refinancing uncertainty under ATO guidance. smsfadviser.com

[35] SMSF Australia — SMSF Residential Property LRBA Ban: What You Need to Know Confirms 10 August 2026 commencement following 26 June 2026 Royal Assent; explains the amended SIS Act clause; bare trust and finance approval practical timeline guidance. smsfaustralia.com.au

[36] Heffron — LRBA Ban: What the Proposed Change Means for SMSFs Detailed legal explanation of the ‘single acquirable asset’ and ‘business real property’ conditions; confirms no new-build exception unlike negative gearing reforms; commercial/business real property carve-out mechanics. heffron.com.au

[37] The Adviser — Government Agrees to Ban Future LRBAs for Resi Joint statement from PM Albanese and Treasurer Chalmers; Greens negotiating position and rationale; confirmation that existing arrangements and time to finalise transactions in train are protected; $50 million budget impact figure. theadviser.com.au

Disclaimer: This blog contains general information only and is intended for educational purposes. It does not constitute financial, tax or legal advice. Phil Aldridge is a licensed mortgage broker and does not provide tax advice. Please consult a qualified accountant, financial adviser or solicitor regarding the impact of these legislative changes on your individual circumstances. All figures are indicative only. Information current as at early July 2026.