The Federal Budget has landed, and there are some significant proposals on the table this year, spanning individual taxpayers, small businesses, and trust structures, and the timing of some of these changes stretches well into 2028 and beyond.We’ve linked to a 4-page summary below.
We’ll be following this up with our own in-depth analysis once we know what’s been passed into law. For now, here’s the official summary to get you across the key announcements.
If you’d like to talk through how any of these changes affect your situation, get in touch with our team.
Download the full summary here
Key takeaways from the 2026 Federal Budget summary
For individuals
Workers get a new $1,000 instant tax deduction for work-related expenses, with no need to itemise receipts if your claim sits under that threshold. On top of that, a $250 annual Working Australians Tax Offset is coming from 1 July 2027, which effectively raises the tax-free threshold by around $1,800 for eligible workers. The revised Stage 3 tax cuts are also proceeding, with the rate dropping from 16% to 15% on 1 July 2026, and again to 14% on 1 July 2027.
The CGT and negative gearing changes are the headline items. From 1 July 2027, the 50% CGT discount goes, replaced by cost base indexation with a 30% minimum tax on net gains. That’s a major shift for anyone holding investment assets. Negative gearing on established residential properties is also being restricted from the same date, with losses only deductible against rental income or capital gains from residential property. Properties acquired before 7:30pm AEST on 12 May 2026 are exempt, but anything after that date falls under the new rules.
For small businesses
The $20,000 instant asset write-off becomes permanent from 1 July 2026 for businesses with aggregated turnover up to $10 million. Loss carry-back provisions are being extended, giving eligible companies the ability to offset a current year loss against tax paid in the previous two years. From 1 July 2027, small and medium businesses will also be able to opt into monthly PAYG instalment reporting using ATO-approved calculations embedded in their accounting software.
For trusts
A 30% minimum tax on discretionary trust income is proposed from 1 July 2028. Beneficiaries other than corporate beneficiaries will receive non-refundable credits for the tax paid. Rollover relief will be available between 1 July 2027 and 30 June 2030 for those looking to restructure out of a discretionary trust into a company or fixed trust ahead of the change.
These proposals span multiple financial years, so the timing of decisions made now could matter.
