Question 1

How is capital gains tax calculated in Australia?

Accepted Answer

There is no separate capital gains tax. Your net capital gain is added to your taxable income for the year and taxed at your marginal rates, which is why the answer depends entirely on what else you earned. The sequence set out in section 102-5 is: work out the gain on each asset, subtract capital losses from this year and any carried forward, then apply the 50% discount to what remains of any asset you held more than twelve months. The order matters — losses come off before the discount, never after, and doing it the other way round overstates the tax by half the loss.

Question 2

Do I get the 50% CGT discount?

Accepted Answer

If you are an individual and you held the asset for at least twelve months, yes. The clock runs from contract date to contract date, not settlement to settlement, which is the detail that catches people out — a property bought on a contract signed on 15 June and sold on one signed on 20 June the following year qualifies even if neither settlement fell in that window. A complying super fund gets one third rather than a half. A company gets no discount at all, which is why the same sale in a company can cost close to double.

Question 3

Does selling affect my Medicare levy or my HECS repayment?

Accepted Answer

Yes, and this is the part most calculators miss entirely. A capital gain is ordinary taxable income once it reaches your return, so it counts toward the Medicare levy, toward Medicare levy surcharge income, toward study and training loan repayment income, and toward Division 293. In practice that means a sale can trigger a compulsory HELP repayment you were not expecting, and can tip you across a surcharge tier — where the surcharge then applies to your whole income for the year, not just the gain. On a $300,000 gain over a $120,000 salary with a study loan and no hospital cover, those two additions come to more than $22,000 on their own.

Question 4

What can I include in the cost base?

Accepted Answer

Five things: what you paid for the asset, the incidental costs of buying and selling it (stamp duty, conveyancing, the agent's commission, advertising, brokerage), certain costs of owning it that you have not already deducted, capital improvements, and the cost of defending your title. For a rental property there is a sixth consideration that works the other way — capital works deductions you have already claimed come off the cost base, which increases the gain. Ten years of the 2.5% building allowance on a $700,000 property is often around $50,000, and almost no calculator asks for it.

Question 5

Is my home exempt from capital gains tax?

Accepted Answer

If it was your main residence for the whole time you owned it, was not used to produce income, and sits on two hectares or less, the gain is disregarded entirely. If it was your home for only part of the time, the exemption is apportioned on days. Two rules commonly change that fraction: the six-year rule lets you keep treating a home as your main residence for up to six years after you move out while it is rented, and if you first rented out a home that would otherwise have been fully exempt, the cost base resets to its market value on the day it was first rented. Both are worth getting right before you sell — they routinely move the answer by six figures.

Question 6

Is the 50% discount changing?

Accepted Answer

Yes, for gains accruing from 1 July 2027. Treasury Laws Amendment (Tax Reform No. 1) Act 2026 replaces the 50% discount for individuals, trusts and partnerships with cost base indexation plus a 30% minimum tax rate. Gains accrued before that date keep the discount, and the four small business CGT concessions are explicitly retained. This calculator models current law, which is the law that applies to every sale contracted before then. The transition detail is still being settled, so check it against the legislation rather than against any calculator when you are planning a sale that straddles the date.

Capital gain	After 50% discount	Tax	Effective rate	You keep
$200,000	$100,000	$38,850	38.9%	$161,150
$300,000	$150,000	$62,350	41.6%	$237,650
$400,000	$200,000	$85,850	42.9%	$314,150
$500,000	$250,000	$109,350	43.7%	$390,650
$750,000	$375,000	$168,100	44.8%	$581,900
$1,000,000	$500,000	$226,850	45.4%	$773,150

Capital gains tax calculator. What the sale actually costs you.

Capital gains tax on a property sale, 2026-27

Common questions