Capital gains tax reform: why business owners need a market valuation before 2027

Have you considered your tax circumstances and started preparing your market valuations ahead of the new capital gains tax (CGT) regime implementation? The Treasury Laws Amendment (Tax Reform No. 1) Act 2026 is now law, and it's the most significant change to Australian capital gains tax in more than 25 years. For business owners, the impact goes well beyond property. Every business asset, sale, exit and succession plan built under the current rules needs a fresh look before the new regime takes effect on 1 July 2027. This review should start now, not in the months before the deadline. 

In summary, from 1 July 2027 the reforms will: 

• Replace the longstanding 50% CGT discount for individuals, trusts and partnerships with cost-base indexation (adjusting the asset cost for inflation). 

• Introduce a minimum 30% tax rate on capital gains covered by the new regime. 

• Limit negative gearing for residential property investments to new builds, subject to grandfathering and transitional rules.

It’s also important to note that: 

• Existing gains accrued before 1 July 2027 are generally protected through transition rules, meaning taxpayers effectively enter a new CGT regime from that date forward. 

• Any accrued gains on pre-CGT assets up to 1 July 2027 remain exempt, however any increase in value from 1 July 2027 onwards is brought within the CGT system. 

Business owners should not be complacent.  Careful planning now, across existing portfolios, planned transactions and reporting systems, will ensure a smoother transition to the new regime. The complexity of the reforms should not be underestimated. 

Need help understanding how the changes could impact you and your business? Talk to your Findex advisor. 

Why market valuations matter before 1 July 2027 

Robust market valuations as at 1 July 2027 will be critical, particularly for unlisted assets and investments. Should taxpayers elect to delay valuations until such time that the asset is eventually sold may present issues, as the ability to prepare retrospective market valuations become more difficult over time. Obtaining accurate back-dated information is not without complications, and therefore the assessment of market value can be challenging.  

Further, while an alternative apportionment method is expected to be available for taxpayers to elect at the time the asset is ultimately sold, this method may not result in the most optimal tax outcome. 

The transition to the new regime will require taxpayers to clearly identify gains that accrued before and after 1 July 2027.  This means that accurate records, defensible market valuations and supporting documentation will be of vital importance, particularly for privately held assets. 

Preparing independent, robust market valuations  as at 1 July 2027 will support informed decision making and commercially sound outcomes. 

What the reform means for business exits and succession planning 

The reforms will influence investment decisions, business exits, family wealth structures and succession planning, as CGT represents a significant element when planning a future sale. 

Whether contemplating a third-party sale, management buyout, private equity transaction or family succession, the after-tax proceeds can materially influence both deal structure and timing. 

If a business sale is likely within the next five years, now is the time to model the potential outcomes and contemplate the potential impact of the new rules.  There may be opportunities to accelerate transactions or restructure. 

Business owners who understand the implications early, review their structures and seek advice ahead of major transactions will be best placed to navigate the changes with confidence. 

When contemplating a transaction, including share transfers, a third-party or private equity sale, management buyout, or family succession, the full tax implications can materially influence both deal structure and timing." 

Tax planning considerations before the CGT reform 

Taxpayers should carefully consider tax planning options, such as whether to crystallise their gains or losses before 1 July 2027 (under the existing regime), or to retain the asset and apply the new regime. 

It’s vital to understand where unrealised gains exist, review expected holding periods and model future outcomes under the new regime.  Early planning will provide greater flexibility and enable the ability to make informed decisions rather than reactive ones. 

The Government has confirmed that the small business CGT concessions are staying, and the turnover threshold for the 50% active asset reduction will rise from $2 million to $10 million. This remains an important consideration for business owners and may continue to deliver significant benefits where eligibility requirements are met.  

Future reporting requirements 

Investors and trustees will need to consider the system and reporting changes required under the new regime.  Infrastructure will need to ensure that CGT records accurately capture adjusted cost bases and calculate the four new categories of capital gains introduced under the reform:  

• Deferred non-residential capital gains: non-residential gains triggered by deemed CGT events immediately prior to 1 July 2027. 

• Deferred residential capital gains: residential property gains triggered by deemed CGT events immediately prior to 1 July 2027. 

• Non-residential capital gains: standard capital gains from non-residential CGT events occurring on or after 1 July 2027. 

• Residential capital gains: capital gains from residential property CGT events occurring on or after 1 July 2027. 

These categories segment gains based on asset type and whether they arise from transitional rules just before, or from events on or after, the implementation date. 

Be proactive

At Findex we have specialised professionals across Valuations, Tax Advisory and Mergers & Acquisitions, with deep, commercial expertise to assist you with your considerations and enable you to take required actions to prepare for the implications of the new regime. 

Contact us today to start taking proactive steps before the reforms commence. 

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This document contains general information and does not constitute legal or taxation advice. If you need legal or taxation advice, we recommend you speak to a qualified adviser. 

While all reasonable care is taken in the preparation of the material in this document, to the extent allowed by legislation Findex Corporate Finance (Aust) Ltd accepts no liability whatsoever for reliance on it. All opinions, conclusions, forecasts or recommendations are reasonably held at the time of compilation but are subject to change without notice. Findex Corporate Finance (Aust) Ltd assumes no obligation to update this material after it has been issued. You should seek professional advice before acting on any material. 

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4 August 2026