This year's budget has been one of the biggest shake ups of the Australian tax landscape in decades! Here's an overview of the changes for individuals, families, and businesses.
FY2027: 1 July 2026 to 30 June 2027
Enacted and operating
- Personal income tax: The rate applying to taxable income from $18,201 to $45,000 fell from 16% to 15% on 1 July 2026. (Australian Taxation Office)
- $1,000 work-expense deduction: Eligible taxpayers earning labour income can claim a standard deduction of up to $1,000 for FY2027, instead of separately claiming covered work expenses. Taxpayers with greater eligible expenses may claim their actual deductions. (Federal Register of Legislation)
- Payday Super: From 1 July 2026, employers must pay superannuation guarantee contributions with employees’ salary and wages rather than quarterly. (Australian Taxation Office)
- SMSF residential-property borrowing ban: From 10 August 2026, super funds cannot enter new limited recourse borrowing arrangements to acquire residential property. Existing arrangements, qualifying acquisitions already contracted and genuine refinancings are protected. SMSFs may still buy residential property without borrowing, subject to existing SMSF rules. (Federal Register of Legislation)
Proposed for FY2027, but not yet law as at 28 July 2026
- Permanent $20,000 instant asset write-off: Proposed for small businesses with aggregated turnover under $10 million, applying to eligible assets first used or installed from 1 July 2026. The ATO states that this measure was not yet law. (Australian Taxation Office)
- Company loss carry-back: Proposed from FY2027, allowing eligible companies to carry losses back against tax paid in the previous two income years. (Budget Australia)
FY2028: 1 July 2027 to 30 June 2028
Enacted
- Further personal tax cut: The rate applying from $18,201 to $45,000 falls from 15% to 14% on 1 July 2027. (Australian Taxation Office)
- $250 Working Australians Tax Offset: A non-refundable offset of up to $250 applies from FY2028 for eligible taxpayers with labour income. This was enacted in June 2026. (Federal Register of Legislation)
- Negative-gearing restrictions: From 1 July 2027, losses from affected established residential properties can no longer generally offset salary or other non-residential income. Losses can be offset against residential-property income and carried forward.
- Properties acquired before 7:30 pm AEST on 12 May 2026 are grandfathered.
- Qualifying new residential builds remain exempt. (Treasury)
- CGT changes: For gains accruing from 1 July 2027:
- the general 50% CGT discount is replaced by inflation indexation
- a minimum effective tax rate of 30% applies to relevant capital gains
- special choices remain for qualifying new-build investments.
These changes affect gains accruing after that date, rather than automatically taxing the entire gain under the new system. (Treasury)
- Discretionary-trust restructuring relief: A three-year rollover window begins on 1 July 2027 for eligible restructures ahead of the trust minimum-tax regime. (Budget Australia)
Announced, but not confirmed as enacted in the sources reviewed
- Monthly PAYG instalment option: Proposed from 1 July 2027, together with broader access to dynamic PAYG instalment calculations. (Budget Australia)
- EV FBT concession: Proposed from 1 April 2027 to replace the full exemption with a 25% FBT discount for eligible EVs costing over $75,000. (Budget Australia)
- Expanded venture-capital tax incentives: Proposed from 1 July 2027. (Budget Australia)
FY2029: 1 July 2028 to 30 June 2029
Announced future measures
- Discretionary-trust minimum tax: A proposed 30% minimum tax rate for discretionary trusts, subject to exceptions, from 1 July 2028. (Treasury)
- R&D Tax Incentive reform: Proposed from 1 July 2028, including changes to refundable offsets, eligible expenditure, turnover thresholds and expenditure caps. (Budget Australia)
- Start-up loss refundability: Proposed from FY2029 for qualifying small start-ups in their first two years, capped by certain employee-related FBT and withholding amounts paid. (Budget Australia)
From 1 April 2029
- EV FBT concession: Proposed transition to a permanent 25% FBT discount for all eligible EVs. Existing qualifying arrangements for vehicles costing up to $75,000 may retain the full exemption where commenced before that date. (Budget Australia)
The key corrections
- The SMSF borrowing restriction belongs in FY2027, commencing 10 August 2026.
- Negative gearing and CGT changes belong in FY2028, commencing 1 July 2027, although the negative-gearing grandfathering date is 12 May 2026.
- The $250 offset belongs in FY2028, not FY2027.
- The $1,000 standard deduction belongs in FY2027.
- The permanent instant asset write-off and company loss carry-back were intended to apply from FY2027, but should be labelled proposed/not yet law, rather than enacted.
Let's be honest, it's a lot. We don't expect our clients to be across all of these changes - we'll help guide you through what's relevant in our review sessions together.