Quick answer
From 1 July 2027 the 50% CGT discount is replaced. Instead, what you paid for the property (the cost base) is adjusted for inflation, and a 30% minimum tax applies to gains under the new rules. Gains built up to 1 July 2027 keep the existing treatment. The property's market value on that date is the dividing line.
Property owners usually ask two things about 1 July 2027. What exactly changes? And will CGT be grandfathered, meaning will the gains already made keep the old rules? The short answer is in the box above. The rest of this guide fills in the detail, including where a CGT valuation fits.
We are registered valuers, not tax advisers, so this guide sticks to what we know best: how the CGT changes from 1 July 2027 make the market value on that day important, and what good evidence looks like. Your accountant or tax adviser works out the tax. Our property valuers give them a number they can stand behind.
In this guide
- What has changed on 1 July 2027?
- Will CGT changes be grandfathered? What happens to your old gains
- Why the valuation date matters
- A valuation or an apportionment method: which route?
- When should you get the valuation?
- Which owners are most likely to need one?
- What to have ready for your valuer
- Mistakes to avoid
- Questions owners ask
What has changed on 1 July 2027?
The Treasury Laws Amendment (Tax Reform No. 1) Act 2026 received Royal Assent on 26 June 2026. For sales and other capital gains tax events on or after 1 July 2027, the 50% discount that individuals and trusts use today is replaced by indexing the cost base. Put simply, what you paid for the property is adjusted for inflation, so tax is worked out on the gain after inflation. A minimum tax of 30% also applies to gains under the new rules.
The detail depends on who owns the asset. Companies and super funds that meet the rules (complying funds, including SMSFs) are generally outside these changes, some new residential property can choose between the old and the new treatment, and people receiving certain income support payments are exempt from the minimum tax. Your accountant can tell you which applies to you.
Will CGT changes be grandfathered? What happens to your old gains
"Grandfathered" simply means that what already exists keeps the old rules, and the new rules apply only to what comes after. Is CGT grandfathered? In effect, yes for the gains that built up before 1 July 2027, which are not taxed under the new rules. For property you already own, the law generally treats the asset as if it was sold just before 1 July 2027 and bought back just after, at its market value, or at an amount worked out under an apportionment method (a way of estimating the split, explained below).
The part of the gain up to that date keeps the existing treatment, including the 50% discount, and is taxed when you eventually sell. The part after that date falls under the new rules. So the old gains are protected, but later growth is not.
| Part of your gain | How it is generally treated | What sets the amount |
|---|---|---|
| Built up before 1 July 2027 | Existing rules, including the 50% discount, taxed when you sell | Market value on 1 July 2027, or an estimate from an apportionment method |
| Built up after 1 July 2027 | New rules: what you paid is adjusted for inflation, plus a 30% minimum tax | The sale price compared with the 1 July 2027 value |
Why the valuation date matters
Think of 1 July 2027 as a line through the life of your investment. The value on that day decides how much of your total gain sits on each side of the line. A small difference in that number changes how the gain is split between the two sides.
Illustration only. The real outcome depends on the owner, the asset and the final detail of the switch-over (transitional) rules. Your accountant will calculate your actual result.
A valuation or an apportionment method: which route?
There are two ways to set the starting point. One is a market valuation as at 1 July 2027. The other is an apportionment method, which estimates the split from the growth over the time you have owned the property. The law allows an alternative method to be set by the government, and the ATO has been developing its guidance, so check the latest ATO position and ask your accountant which suits you.
| Compare | Market valuation | Apportionment method |
|---|---|---|
| What it is | An independent opinion of market value as at 1 July 2027 | An estimate of the split, based on growth over the time you have owned the property |
| What you hold afterwards | A report with the date, the sales evidence and the reasoning | A result from an approved method |
| May suit | Property that has changed, uneven growth, or owners who want a defensible record | Simpler holdings, if a method is available and your accountant agrees |
A CGT valuation is also the evidence accountants usually ask for.
When should you get the valuation?
A valuation as at 1 July 2027 can only be finalised once that date has passed and the market evidence for it is available. A valuation done today cannot tell you the value on that future day.
Australian Property Institute guidance suggests a valuation obtained close to 1 July 2027 (ideally within a few months after it, and at most within two years) is more reliable and defensible than one reconstructed years later. You can speak to us before the date to plan the timing and the information we will need.
Want to plan your 1 July 2027 valuation?
Register now and we will contact you about timing and next steps. The report is finalised after the date, so planning early helps.
Which owners are most likely to need one?
A 1 July 2027 market value is most likely to matter for:
- Investors who have held property for many years and have large gains built up
- Owners of property bought before 20 September 1985, which has had separate treatment until now
- People who inherited property and still hold it
- Owners of a former home that is now a rental, or property that has been subdivided or developed
- Anyone who has lost the records of what the property was worth in the past, where a retrospective property valuation may help
What to have ready for your valuer
A little preparation makes the valuation faster and the evidence stronger. Gather what you can of the following:
- The contract of sale and settlement statement from when you bought
- Dates and invoices for renovations or other improvements
- Any past valuations, insurance values or council rates notices
- How the property has been used over time: lived in, rented or vacant
- Title details, and plans or approvals if the property was extended or subdivided
- Your accountant's name, so the report can be sent to them
Mistakes to avoid
Common mistakes:
- Waiting years, then reconstructing the value. A valuation obtained close to the date is generally easier to defend.
- Relying on an agent's opinion or an online estimate. These are usually not a formal valuation, and they rarely set out the evidence.
- Assuming every property is treated the same. Companies, SMSFs, pre-CGT property and new residential property can all have different treatment.
- Leaving the records until they are needed. Purchase documents and improvement invoices are easiest to find now.
- Treating a valuation as tax advice. It sets out value at a date. Your accountant works out the tax.
Key terms explained
- Grandfathered
- When a law changes but what already exists keeps the old rules, and the new rules apply only to what comes after. Here, gains built up before 1 July 2027 keep the existing treatment.
- Cost base
- Broadly, what you paid for the property plus certain costs of buying, owning and improving it. It is the figure your gain is measured from.
- Indexation
- Adjusting the cost base for inflation, so the tax falls on the gain after inflation rather than the whole gain.
- Market value
- The price a willing buyer and a willing seller would agree, each acting knowledgeably and without pressure.
- Apportionment method
- A way of estimating how much of your gain built up before 1 July 2027, based on time or growth, instead of a valuation.
- CGT event
- The trigger for capital gains tax, most often selling the property.
Need a CGT valuation? Talk to a valuer.
Tell us the property, the date you need the value for and what it is for. We will tell you what is needed and what it involves.
Free first call. Fee confirmed before work starts. Certified Practising Valuer. Australia-wide.
Sources and further reading
- Australian Taxation Office: Capital gains tax
- Parliamentary Library: Treasury Laws Amendment (Tax Reform No. 1) Bill 2026
- Australian Property Institute: The CGT changes and property valuations
This is general information, not tax advice. Speak to your accountant or tax adviser about your own position. A valuation sets out market value at a stated date. It does not work out your tax.