Introduction
The 2026–27 Federal Budget represents a clear shift away from short‑term cost‑of‑living measures toward structural reform and long‑term sustainability.
Like most other budgets, key measures were announced with limited information given. As the saying goes, the devil is in the detail, and we will seek to provide more detailed information as it becomes available.
Based on the limited information available, we have provided some analysis below.
Impact on Businesses
For businesses, the Budget is largely about certainty rather than stimulus.
There are no changes to headline company tax rates, providing stability for business planning and investment decisions.
Tax reforms affecting capital gains and discretionary trusts will be relevant for many business owners and private groups.
In the case of discretionary trusts, from 1 July 2028, a 30% minimum tax will apply to the trustee of discretionary trust. Beneficiaries will be able to receive non-refundable credits for tax paid by the trustee. There will be a timing window where discretionary trust may be restructured into fixed trusts or companies with rollover relief. There is intended to be possible carve-outs for primary producers and small family enterprises, however no further detail was provided.
For capital gains, from 1 July 2027, for CGT assets outside of superannuation funds, the general 50% CGT discount will be replaced with cost base indexation. The new regime will also include a 30% minimum tax on net capital gains. Notably, pre-CGT assets will also be subject to capital gains tax from 1 July 2027. Further information on how assets held prior to 1 July 2027 will be transitioned into the new indexation rules will be released later.
For small businesses, the Budget confirms the $20,000 Instant Asset Write‑Off on a permanent basis from 1 July 2026, available to businesses with aggregated turnover under $10 million. Importantly, there was no extension or increase to the write‑off threshold, and no expansion to larger businesses.
Impact on Individuals
For individuals, the Budget combines modest tax relief, simplification, and significant long‑term changes to housing and investment rules.
A new $1,000 standardised tax deduction will apply from the 2026–27 income year, allowing employees and sole traders to claim up to $1,000 in work‑related expenses without keeping receipts. They can still choose to claim expenses over $1,000 as long as they have substantiation.
From a housing perspective, negative gearing will be restricted to newly built residential properties from 1 July 2027, with existing investments grandfathered. In addition, the 50% capital gains tax discount will be replaced with an inflation‑indexed cost base, reducing the generosity of tax concessions on long‑held assets outside superannuation.
A $250 Working Australians Tax Offset will also apply from the 2027–28 income year, providing modest ongoing relief to workers.
Summary:
While the immediate financial impact for many individuals may be limited, the longer‑term implications for property investment, asset sales and tax planning are substantial and highly dependent on personal circumstances.
Impact on Superannuation
Superannuation was not a major focus on Budget night, but existing reforms and policy stability are notable.
The Superannuation Guarantee Remains to 12% from 1 July 2026, as previously legislated, and payday super will commence, requiring employers to pay super contributions at the same time as wages.
No additional superannuation tax changes were announced, meaning contribution caps and tax concession settings remain broadly unchanged for most Australians in the near term.
Final Thought
The 2026 Federal Budget prioritises structural reform over short‑term relief. While the immediate impact may feel modest for some, the longer‑term effects — particularly across housing, investment taxation and business structures — will influence financial decisions for many years to come.
As always, the relevance of these changes depends on individual and business circumstances, and careful planning will be key. Feel free to reach out to your TAG advisor if you need any assistance.
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Disclaimer: The information contained is general in nature. Professional advice should be sought before acting on any aspect on this page. Financial planning services provided by TAG Financial Advisors Pty Ltd (ABN 77 154 205 017 AFSL 415632), a wholly owned subsidiary of TAG Financial Services Pty Ltd (ABN 67 075 374 686). Copyright 2026. Please do not reproduce without the expressed written consent of the author.