From 1 July 2027, several of the capital gains tax (CGT) rules that property investors rely on today change under law enacted in June 2026. CGT is the tax on the profit when you sell an asset that isn’t exempt — for an investor, that is usually an investment property. The core change is straightforward to state: the 50% CGT discount ends for most individual investors, inflation indexing of the cost base returns in its place, and a new minimum tax applies to capital gains. The changes bite on CGT events that happen on or after 1 July 2027, so which set of rules applies to a sale depends on its timing — not on when the law was passed.

What is changing for property investors on 1 July 2027?

The changes come from the Treasury Laws Amendment (Tax Reform No. 1) Act 2026 (Act No. 49 of 2026), which received royal assent on 26 June 2026, together with a companion Act that adjusts the rates. The ATO summarises the package in its guidance on the 2026 home-ownership, negative-gearing and CGT reforms. Everything below applies to CGT events on or after 1 July 2027.

Change	What it means for investors
50% CGT discount ends	No half-off on gains for most individuals
CPI indexation returns	Cost base adjusts for inflation instead
30% minimum tax (Division 119)	A floor rate on residential and other gains
Negative gearing quarantined	Rental losses ring-fenced to rental income
Transition valuation at 30 June 2027	Pre-changeover gains keep the old treatment

Not every gain is treated the same way. The discount is retained for new residential dwellings and for property that qualifies as affordable housing (at least 50% affordable housing), and complying super funds keep their 33.33% discount. What counts as a “new residential dwelling” is to be set by a legislative instrument that has not been registered as at July 2026, so the exact edge of that carve-out is not yet settled. The sections below take each change in turn.

Does the 50% CGT discount still apply after 1 July 2027?

Not for most investors. The CGT discount lets an eligible owner reduce a taxable capital gain by a set percentage if they held the asset long enough. As at July 2026, for CGT events before 1 July 2027, the ATO’s CGT discount settings by owner type are:

Owner type	Discount (for events before 1 July 2027)
Individual (Australian resident)	50%, held at least 12 months
Trust	50%, same 12-month test
Complying super fund	33.33%
Company	No discount — full gain taxed

For CGT events on or after 1 July 2027, the 50% discount no longer applies to individuals, trusts and partnerships. It is kept only for new residential dwellings and qualifying affordable housing, and complying super funds keep the 33.33% figure. In place of the discount for everyone else, indexation of the cost base returns — the next section explains what that means.

What replaces the discount — CPI indexation of the cost base?

Indexation adjusts the cost base of an asset upward for inflation, so that only the real gain above inflation is taxed. It was how Australian CGT worked before the 50% discount was introduced, and it returns for CGT events on or after 1 July 2027. Most parts of the cost base are indexed; ownership costs — the third cost base element, such as interest, rates and insurance — are excluded.

The practical difference is one of method. A discount takes a flat percentage off the gain; indexation instead lifts the cost base by an inflation factor before the gain is worked out, so the benefit depends on how long you held the asset and how much prices moved over that time. The precise arithmetic — the index figures and the base period used — sits in ATO guidance and the enabling instruments, and a dedicated explainer works through that calculation. What the overview reader needs is the shape of the change: from 1 July 2027, most investors move from a flat 50% discount to an inflation adjustment on the cost base.

What is the new 30% minimum tax on capital gains?

The reform introduces a new Division 119 that sets a minimum 30% tax on residential and non-residential capital gains, with new dwellings excluded. It is a floor: it sets a lower bound on the tax that applies to a gain caught by the rule.

How that floor is worked out — how the 30% minimum interacts with your marginal income tax rate and with the newly indexed gain — is set out in the Division 119 provisions and pending ATO guidance, and a separate explainer covers those mechanics. The point for a general overview is narrower: from 1 July 2027, a minimum 30% tax sits alongside the end of the discount and the return of indexation as the third structural change to how a property gain is taxed.

How do the negative gearing changes affect property investors?

Alongside the CGT changes, the same Act changes negative gearing. Negative gearing is where the running costs of a rental property exceed the rent it earns, producing a loss that — under the current rules — can be deducted against your other income, such as your salary. From the 2027-28 income year, that changes for residential property.

From 2027-28, residential rental losses are quarantined: deductions that exceed the residential rental income can no longer be offset against other income. Instead, a quarantined loss can be used against residential capital gains, or carried forward against future residential rental income. That link to capital gains is exactly why the negative gearing change belongs in a CGT overview — the two reforms meet at the point where a rental loss is set against a property gain.

Two carve-outs sit around the rule. Interests acquired before 7:30pm AEST on 12 May 2026 are grandfathered — the quarantine does not apply to them. New residential dwellings are exempt, though (as with the discount carve-out) what qualifies as a new dwelling is to be defined by a legislative instrument not registered as at July 2026. Widely held unit trusts and complying super funds are also outside the rule.

How do the 2027 rules apply to Brix?

They cannot simply be read across. A Brix is a fractional economic interest in a property — a financial product under the Corporations Act 2001, not ownership of the property itself. When you hold Brix the owner remains the registered legal owner of the home; each property is divided into 10,000 Brix representing all of its economic benefits, being future net sale proceeds and, where applicable, net rental proceeds. A directly held investment property is a different kind of asset: it is a CGT asset in the investor’s own hands, which is what the rules above are written around.

That difference in legal character is why the reform can’t be mapped onto a Brix from the general settings. As at July 2026, neither ATO guidance nor any registered legislative instrument sets out how the 1 July 2027 changes — the end of the 50% discount, the return of indexation, or the Division 119 minimum tax — apply to fractional or indirect interests in residential property. The general settings are enacted; how they apply to a fractional interest specifically has not been published. How a Brix is taxed depends on the structure and on your own circumstances, so the Product Disclosure Statement and a registered tax agent are the right places to confirm your position.

Under the MyBrix PDS current as at July 2026 (version 4.0), investors pay no fee to open an account, no fees to purchase or hold Brix, and no stamp duty on purchase.

What happens to the gains you have already built up?

The reform does not rewrite the tax on gains you have already made. Under the transition, an asset you hold on 30 June 2027 is treated as sold and reacquired at market value just before 1 July 2027 — or an apportionment method can apply instead — so the gain built up to that point keeps the old treatment, and only the part accruing afterwards falls under the new rules. Even assets acquired before 20 September 1985 — pre-CGT, and until now outside the CGT net — have their post-1-July-2027 accrual brought into the net.

That makes your records more important, not less. The ATO’s record-keeping rules for property CGT require records to be kept for the whole period you own a property, plus at least 5 years after you dispose of it — and the value of a property at key dates is exactly the kind of figure a transition like this turns on. When a formal valuation is needed rather than an estimate, and how the apportionment method is worked out, are covered in the transitional ATO guidance and a dedicated explainer; the enabling instruments were not yet registered as at July 2026, so the detailed method is not yet settled.

Does the timing of a sale change which CGT rules apply?

Yes, as a matter of fact. Because the changes apply to CGT events on or after 1 July 2027, the date of the CGT event — for a sale, generally the date you sign the contract, not the date of settlement — decides which set of rules applies. A sale with a contract date before 1 July 2027 is worked out under the current rules; one on or after that date falls under the new ones.

That is a factual statement about which rules apply, not a reason to bring a sale forward or push it back. Whether the timing of a sale makes sense for you depends on your own position — the size of any gain, your income for the year, your plans for the property, and costs that have nothing to do with tax. Those are trade-offs to weigh with a licensed professional, who can model your actual numbers under each set of rules.

Tax outcomes depend on your circumstances — speak with a registered tax agent before acting.

Where to start

For the fundamentals underneath all of this — how a capital gain is calculated, what the cost base includes, and how the main residence exemption works — see our guide to capital gains tax on property in Australia. The 2027 reform changes several of the settings, but the underlying arithmetic of a CGT calculation is the same starting point. From there, each change above — the end of the discount, the return of indexation, the Division 119 minimum tax, and the transition valuation — has its own explainer for the detail this overview leaves out.