Quick answer
Capital gains are added to your taxable income. Australian-resident individuals and trusts that hold an asset for 12 months or more get a 50% discount (complying super funds get one third); companies get none. A $200,000 gain for someone earning $90,000 costs about $35,850 in tax in 2026–27. From 1 July 2027 the discount is replaced by indexation and a 30% minimum tax for gains that build up after that date.
How capital gains tax is worked out
Capital gains tax is not a separate tax. Your capital gain is added to your taxable income and taxed at your marginal rate for the year the contract is signed. The gain is the sale price less the cost base. The cost base includes the purchase price plus stamp duty, legal and agent fees, and capital improvements you have not already claimed.
Capital losses from this year or earlier years come off the gain first. The discount then applies to what is left. A capital loss can never be used against salary or business income; it waits for a future gain.
CGT discount rates for 2026–27
| Owner | Discount | Notes |
|---|---|---|
| Individual or trust (Australian resident) | 50% | Owned 12 months or more |
| Complying super fund, including an SMSF | 33⅓% | Owned 12 months or more; the rest is taxed at 15% |
| Company | None | Taxed at 25% or 30% |
| Foreign resident individual | None | No discount on gains after 8 May 2012 (part discount if you were a resident for some of the time) |
The 12 months are counted from the contract date you bought to the contract date you sold, leaving out both days. Settlement dates do not count. For example, a resident earning $90,000 who makes a $200,000 gain on a property held for three years adds $100,000 to taxable income and pays about $35,850 in extra tax and Medicare levy for 2026–27. The resident rates the calculator uses are:
| Taxable income | Rate on this band |
|---|---|
| $0 – $18,200 | Nil |
| $18,201 – $45,000 | 15% |
| $45,001 – $135,000 | 30% |
| $135,001 – $190,000 | 37% |
| $190,001 and over | 45% |
Your home, the 6-year rule and foreign residents
Your main residence is generally exempt. If you move out and rent it, you can keep treating it as your main residence for up to 6 years, as long as you don't claim another home at the same time. Leave it empty and there is no time limit. If you rented it out before you moved in, or used part of it for business, only a partial exemption applies. The calculator doesn't work out partial exemptions.
When any Australian property is sold, the buyer must withhold 15% of the price and pay it to the ATO unless the seller hands over a clearance certificate. Since 1 January 2025 there is no value threshold, so Australian resident sellers need a clearance certificate even on a cheap unit. Foreign residents usually have the 15% withheld and claim it back in their tax return, or apply for a variation.
The change from 1 July 2027
The reform announced in the May 2026 Budget is now law. From 1 July 2027 the 50% discount for individuals, trusts and partnerships is replaced by indexation of the cost base for inflation, together with a 30% minimum tax rate on capital gains. It applies only to gains that build up after 1 July 2027. A sale in 2026–27 is taxed entirely under the current rules, and for assets you already own the growth up to 1 July 2027 keeps the old treatment. If you are planning to sell in the next few years, keep records of what the asset was worth around that date. The calculator uses the rules for sales in 2026–27.
When to have an accountant check it
Get advice if the property was ever your home, if you inherited it, if you were a foreign resident for part of the time, or if a company or trust owns it. Small business owners selling a business may qualify for the small business CGT concessions, which the calculator ignores. Our guides on capital gains tax in Australia and investment property tax go into more detail, and the negative gearing calculator shows the yearly side of holding a rental.
TXAS prepares CGT schedules for property, shares and crypto sales as part of the individual tax return, and can model a sale before you sign the contract.
Common questions
How much capital gains tax will I pay on a $200,000 gain?
If you are an Australian resident individual, held the asset for more than 12 months and earn $90,000 a year, about $35,850 in 2026–27. Only half the gain ($100,000) is taxed, at your marginal rate plus the 2% Medicare levy.
How long do I have to hold property to get the 50% CGT discount?
At least 12 months, counted between the two contract dates and excluding the day you bought and the day you sold. Settlement dates are not used.
Is the 50% CGT discount being removed?
For individuals, trusts and partnerships it is replaced from 1 July 2027 by cost-base indexation and a 30% minimum tax. Only gains that build up after 1 July 2027 are affected, so sales in 2026–27 still get the 50% discount.
What is the 6-year rule for CGT?
If you move out of your home and rent it out, you can treat it as your main residence for up to 6 years and pay no CGT on a sale in that time, provided you don't claim another main residence. Each separate absence gets its own 6 years.
Do I need a clearance certificate to sell my house?
Yes, if you are an Australian resident. From 1 January 2025 the buyer must withhold 15% from every property sale unless you give them an ATO clearance certificate by settlement. Apply online well before settlement.
Can a capital loss reduce my salary income?
No. A capital loss only offsets capital gains, this year or in later years. Unused losses carry forward with no time limit.
Sources: ATO: CGT discount · ATO: treating a former home as your main residence · ATO: foreign resident capital gains withholding · ATO: reforming negative gearing and capital gains tax