Capital Gains Tax Rate Australia 2026-27: What You'll Actually Pay

Australia does not have a flat capital gains tax rate. The rate you pay on a capital gain depends on your total income, your marginal tax bracket, and how long you held the asset. For most investors in 2026-27, the effective CGT rate is somewhere between 0% and 23.5% under current rules — rising to between 0% and 47% under the proposed new rules from July 2027.

This page is a plain-English reference guide to CGT rates in Australia for 2026-27. For a detailed explanation of how the rules are changing, see our full guide to the CGT changes from 1 July 2027.

Calculate your specific CGT: Use our CGT Comparison Calculator to model your after-tax return on a specific investment under both current and proposed rules.

How CGT rates work in Australia

Capital gains tax in Australia is not a separate tax — it's income tax applied to capital gains. Here's how it works:

You sell an asset for more than you paid
You calculate the capital gain (sale price minus cost base)
If you held the asset for more than 12 months, you apply the 50% CGT discount — only half the gain is assessable income
That assessable gain is added to your other income (salary, rent, interest) for the year
The combined income is taxed at your marginal rate (including the 2% Medicare levy)

The effective CGT rate on a discounted gain is therefore: your marginal rate × 50%

Effective CGT rates: current rules (2026-27)

The table below shows what you'll actually pay on a capital gain in 2026-27, assuming the asset was held more than 12 months and the gain takes you fully into each bracket.

Taxable income (before gain)	Marginal rate incl. Medicare	50% discount applied	Effective CGT rate
$0 – $18,200	0%	Yes	0%
$18,201 – $45,000	18%	Yes	9%
$45,001 – $135,000	32%	Yes	16%
$135,001 – $190,000	39%	Yes	19.5%
$190,001+	47%	Yes	23.5%

Key point: The 50% CGT discount halves your effective rate relative to your marginal rate. A top-bracket investor pays 23.5% effective CGT — not 47%.

What if I held the asset less than 12 months?

No discount applies. The entire gain is assessable income, taxed at your full marginal rate. At the top bracket, that means 47% on the full capital gain — double the rate compared to holding for 12+ months. The 12-month holding rule is one of the most valuable free tax strategies in Australia.

How CGT stacks on top of other income

Your capital gain is added to your other income for the year, which can push you into a higher bracket. This is important to model carefully.

Example: Emma earns $80,000 salary and sells shares with a $60,000 gain (50% discounted to $30,000 assessable).

Salary income: $80,000 (in the 32% marginal bracket)
Assessable gain: $30,000
Combined: $110,000 — still in the 32% bracket
CGT: $30,000 × 32% = $9,600
Effective rate on original $60,000 gain: 16%

Example with bracket push: Sam earns $125,000 and sells an investment property with a $200,000 gain (discounted to $100,000 assessable).

Salary: $125,000 (in 32% bracket)
Assessable gain: $100,000
Combined income: $225,000 — $10,000 crosses into 39% bracket and a further $35,000 crosses into the 47% bracket at $190,001
The CGT is blended across brackets, making the effective rate higher than 16%

Always calculate the blended rate across your full combined income, not just your salary bracket.

Effective CGT rates: proposed new rules (from 1 July 2027)

From 1 July 2027, the 50% CGT discount is proposed to be replaced with cost base indexation and a 30% minimum tax floor. The table below shows the proposed effective rates.

Taxable income	Marginal rate incl. Medicare	30% minimum floor	New effective CGT rate
$0 – $18,200	0%	30% applies	30%
$18,201 – $45,000	18%	30% applies	30%
$45,001 – $135,000	32%	32% > 30%, so marginal rate	32% less CPI relief
$135,001 – $190,000	39%	39% > 30%, so marginal rate	39% less CPI relief
$190,001+	47%	47% > 30%, so marginal rate	47% less CPI relief

CPI relief means the taxable amount is reduced by inflation — you only pay tax on the real gain, not the full nominal gain. The effective rate on the real gain remains your marginal rate (or 30% minimum). How much relief this provides depends on how long you held the asset and what CPI did during that time.

Old rules vs new rules at each bracket

Marginal rate	Effective CGT rate (current, 50% discount)	Effective CGT rate (proposed, indexed)
0% (below $18,201)	0%	30%
18% ($18,201–$45,000)	9%	30%
32% ($45,001–$135,000)	16%	32% (on real gain)
39% ($135,001–$190,000)	19.5%	39% (on real gain)
47% (above $190,000)	23.5%	47% (on real gain)

The new rules are significantly worse for lower-income investors (0–18% bracket) and modestly worse for middle and high-income investors — unless inflation has been very high during the holding period, in which case indexation provides more relief.

How much CPI indexation is worth

The value of indexation depends on how long you held the asset and the inflation rate during that period.

Example: You bought shares for $50,000 ten years ago and sell for $150,000. The 50% discount method vs CPI indexation at 2.5% average annual CPI:

Current rules (50% discount):

Gain: $100,000 → 50% discount → $50,000 taxable
Tax at 32%: $16,000

New rules (indexation at 2.5% for 10 years):

Indexed cost base: $50,000 × (1.025)^10 = $64,004
Real gain: $150,000 − $64,004 = $85,996 taxable
Tax at 32%: $27,519

The 50% discount saves $11,519 compared to indexation in this example — the discount is significantly more generous for assets growing well above CPI, which describes most Australian equities and property over the past decade.

When indexation beats the 50% discount: If your cost base is very large relative to the gain (asset grew barely above CPI) and you're near the 30% marginal rate, indexation can produce a lower tax bill. This is uncommon for typical Australian equity and property investors.

CGT on shares held less than 12 months

No discount. No indexation relief under the new rules either — assets held under 12 months will simply pay the full marginal rate on the full gain under both current and proposed rules.

Holding period	Current effective rate	Proposed effective rate
Under 12 months	Full marginal rate (0–47%)	Full marginal rate (0–47%)
12+ months (current)	Marginal rate × 50%	N/A (50% discount)
12+ months (from July 2027)	N/A	Marginal rate on (gain minus CPI indexation), min 30%

CGT on assets inherited or received as a gift

Inherited assets generally take on the deceased's original cost base and acquisition date. If the deceased held the asset for more than 12 months, the beneficiary inherits the 50% discount entitlement. The date of death is treated as the acquisition date for the beneficiary — so if the estate sells the asset, the 12-month clock restarts.

Gifts are treated as a disposal at market value on the date of transfer. The donor pays CGT on the difference between market value and their original cost base.

CGT on main residence

Your principal place of residence is generally fully exempt from CGT provided:

You lived in it for the entire ownership period
You didn't use it to produce income (rent or business use)

Partial exemption applies if you used it to produce income for some of the period. The partial exemption is calculated proportionally based on the time it was your main residence vs income-producing.

CGT and superannuation

Superannuation funds are taxed separately from individuals. A complying super fund pays:

15% tax on taxable income inside the fund
A 33.3% CGT discount on assets held more than 12 months (the effective rate becomes 10%)

Under the proposed July 2027 changes, super funds retain their 33.3% discount. The new indexation rules do not apply to super funds. This creates a structural advantage for assets held inside super under the new regime compared to holding outside super — particularly for investors who previously held growth assets outside super to access the 50% discount.

Practical strategies to manage your CGT rate

1. Hold for 12+ months. The single most valuable CGT strategy. The difference between 32% and 16% effective rate (or 32% and ~23% effective rate under new rules) is significant on large gains.

2. Time the sale to a lower-income year. If you control when you sell, choosing a year with lower other income reduces bracket stacking. A year you take parental leave, reduce hours, or have large deductions can significantly cut the blended rate.

3. Use capital losses to offset gains. Capital losses in the same year are applied first to reduce the assessable gain. Carried-forward losses from prior years can also offset gains — they must be applied before the 50% discount is calculated.

4. Spread large gains across multiple tax years. Where the nature of the asset permits it (partial disposals, staged sales), spreading a large gain across two tax years can keep the combined income in a lower bracket.

5. Consider super contributions. Making concessional contributions (salary sacrifice) in the year of sale increases your deduction, reducing your assessable income. The gain still gets added, but the net taxable income may stay in a lower bracket.

6. Get a formal valuation at July 2027 (if holding past the transition). For assets held before 1 July 2027 and sold after, a formal market valuation at 1 July 2027 establishes the split between the pre-July 2027 gain (eligible for 50% discount) and the post-July 2027 gain (indexation). A higher valuation at that date maximises the pre-July 2027 portion.

This article is for general information only and does not constitute financial, tax or legal advice. Individual circumstances vary. Tax rates and rules are for the 2026-27 financial year and the proposed changes effective 1 July 2027 (subject to parliamentary passage). Consult a registered tax agent before making decisions.