Why 1 July 2027 matters less than people think
On 1 July 2027 the 50% CGT discount ends for growth from that date. But the law treats everything you own as sold and bought back on 30 June 2027 at its value then. The gain up to that point keeps the discount and waits until you actually sell. Selling before July 2027 doesn't protect anything that keeping it doesn't already protect.
What changes is the growth after 30 June 2027. Under the old rules half of it was taxed. Under the new rules all of it is taxed, but only the part above inflation, because your cost is indexed by CPI. There's also a 30% minimum tax on that later growth.
The break-even growth rate
Roughly, taxing half of the whole increase and taxing all of the increase above inflation come out equal when the property grows at about twice the inflation rate. With inflation at 2.5%, that's around 5% a year. The calculator works out the exact figure for your property, income and holding period.
Our default example (bought for $600,000 in 2018, worth $900,000 today, owner on $120,000) breaks even at 5.3% a year. Kept until July 2032:
| Growth from today | CGT, new rules | If the discount stayed | Difference |
|---|---|---|---|
| 3% a year | $61,475 | $89,647 | $28,172 less |
| 4% a year | $87,093 | $103,582 | $16,489 less |
| 6% a year | $142,882 | $133,426 | $9,456 more |
When selling early can make sense
- You expect strong growth above the break-even rate and were planning to sell in a few years anyway.
- You planned to sell in a low-income year, such as early retirement. The 30% minimum tax limits how much a low income helps on growth after July 2027 (unless you're on an income support payment that year).
- You'd sell anyway for reasons that have nothing to do with tax: the property no longer suits, it needs work you don't want to fund, or you need the money.
Against that, selling has real costs the tax table doesn't show: agent's fees, the rent you stop earning, and stamp duty if you buy again. On a $900,000 property, selling and buying back in costs tens of thousands, more than the tax difference in most of the examples above.
What this calculator doesn't cover
It compares the capital gains tax on a sale, not your whole financial position. It doesn't model the rent and holding costs between now and the sale, what you'd do with the proceeds, the main residence exemption, or properties held in a trust, company or SMSF. For the full picture of holding on, run the full analysis.