From payroll to superannuation, deduction limits to industrial relations updates, 1 July 2025 brings a raft of changes that could impact your cashflow, tax position and compliance burden. If your business operates in Western Australia, or has any exposure to national standards, these are not things to leave until “later”. This article outlines the key shifts, why they matter, and what you need to do now.
Important Note
The 2026–27 Federal Budget includes several proposed tax changes that may affect individuals, property investors, business owners, family trusts and corporate clients.
These measures are Budget announcements only. They are not final law unless and until they are passed through the legislative process.
Some proposals may still be subject to:
- Legislative approval
- Amendments
- Timing changes
- Further detail
- Transitional rules
- Possible delay or non-progression
This summary is intended to help clients understand the key areas to watch and consider whether they should review their tax structure, investment strategy or business planning.
It should not be treated as confirmation of final tax law.
Quick Summary of Proposed Changes
| Measure | Proposed Start Date | Who May Be Affected |
|---|---|---|
| Capital Gains Tax reform | 1 July 2027 | Property investors, share investors, family trusts, long-term investors |
| Negative gearing changes | 1 July 2027 | Current and future residential property investors |
| $1,000 work-related deduction | FY2026–27 | Salary and wage earners |
| 30% minimum tax on discretionary trusts | 1 July 2028 | Family trusts, professional service businesses, SME structures |
| Permanent $20,000 instant asset write-off | 1 July 2026 | Eligible small businesses with turnover under $10 million |
| Company loss carry-back rules | FY2026–27 | Eligible companies with fluctuating profits or tax losses |
Businesses & Private Groups
1. Proposed 30% Minimum Tax on Discretionary Trusts
Proposed from 1 July 2028
A 30% minimum tax rate is proposed for discretionary trusts from 1 July 2028, with some exceptions.
This may be relevant for family trusts, professional service businesses, SME groups and private business structures.
Who may be affected?
- Family trusts
- Professional service businesses
- SME business structures
- Private groups using discretionary trusts
Action point
Trust structures, succession planning and profit distribution arrangements should be reviewed early, especially where a trust is part of a broader family or business structure.
Because this proposal is not yet law, any review should focus on understanding potential exposure and planning options rather than assuming the final rules are confirmed.
2. Permanent $20,000 Instant Asset Write-Off
Proposed from 1 July 2026
The $20,000 instant asset write-off is proposed to become a permanent measure from 1 July 2026 for eligible small businesses with annual turnover under $10 million.
This may allow eligible businesses to immediately deduct the cost of eligible business assets costing less than $20,000.
Who may benefit?
- Small businesses
- Sole traders
- Companies purchasing eligible depreciating assets
- Businesses planning equipment, technology or office purchases
Action point
This may provide greater certainty when planning business asset purchases. However, eligibility, timing and final legislation should still be checked before relying on the deduction.
3. Company Loss Carry-Back Rules
Proposed from the 2026–27 income year
The Budget also includes proposed company loss carry-back rules from the 2026–27 income year.
Under this proposal, eligible companies may be able to carry back tax losses for up to two years and offset them against prior year tax paid.
This may be useful for companies with changing profit levels, growth-related investment costs or temporary losses.
Who may benefit?
- Companies with fluctuating profits
- Growing businesses
- Start-ups and expanding businesses
- Corporate groups with prior year tax paid
Action point
Companies should consider how the proposed rules may affect cash flow planning, tax forecasting and year-end tax planning.
As the measure remains proposed, businesses should confirm the final eligibility rules before making tax planning decisions.
Individuals & Investors
1. Capital Gains Tax Reform
Proposed from 1 July 2027
Capital Gains Tax (CGT) may change from 1 July 2027.
Under the proposed reform, the current 50% CGT discount would be replaced with an inflation-based approach. A minimum 30% tax rate may also apply to certain capital gains.
This may be relevant for individuals and investors who hold long-term assets, including investment properties, shares and other investment portfolios.
Who may be affected?
- Property investors
- Share investors
- Family trusts
- Individuals holding long-term investment assets
Action point
Investors should review their long-term asset disposal strategy before making major decisions, especially where a future sale, transfer or restructure may be considered.
As this proposal is not yet final law, investors should avoid making major decisions based solely on the announcement and should seek advice based on their specific circumstances.
2. Negative Gearing Changes
Proposed from 1 July 2027
Negative gearing rules for residential property are also proposed to change from 1 July 2027.
Under the proposed changes, negative gearing concessions for residential property would be limited to newly built properties. This means future investment decisions may need to consider whether a property is a new build or an established property.
Existing properties held before the announcement are expected to be treated differently under transitional rules.
Who may be affected?
- Current property investors
- Future property investors
- Investors comparing new builds and established residential properties
Action point
Before purchasing an investment property, investors should consider how the proposed rules may affect cash flow, after-tax returns and long-term investment strategy.
However, as the rules have not been finalised, investors should monitor further legislative detail before relying on the proposed treatment.
3. Simplified Work-Related Deductions
Proposed from the 2026–27 financial year
The Budget also includes a proposed $1,000 instant deduction for work-related expenses from the 2026–27 financial year.
This may simplify tax return preparation for many employees with modest work-related expense claims.
Who may benefit?
- Salary and wage earners
- Employees with smaller work-related expense claims
- Taxpayers who claim items such as tools, uniforms, phone use or home office expenses
Action point
Tax return preparation may become simpler for some taxpayers. However, individuals should still seek advice if they have higher claims, specific work-related expenses or uncertain deductions.
As this is a proposed measure, taxpayers should wait for final rules before changing their record-keeping approach.
Key Takeaways
For individuals and investors, the main areas to watch are:
- Proposed CGT reform
- Proposed negative gearing changes
- Simplified work-related deductions
For businesses and private groups, the main areas to watch are:
- Proposed 30% minimum tax on discretionary trusts
- Permanent $20,000 instant asset write-off
- Proposed company loss carry-back rules
Final Thoughts
The proposed 2026–27 Federal Budget tax changes may affect property investment decisions, business cash flow, trust structures and long-term tax planning.
However, many of these measures are not yet law. They may still be changed, delayed or amended before taking effect.
If you own investment properties, operate through a trust, run a business or manage a corporate group, now is a good time to monitor these developments and review your structure and planning strategy with your adviser.
J&N Accountants provides tax, accounting and business advisory support for individuals, property investors, business owners, directors and private groups.
General information only. This article does not constitute tax advice. The measures discussed are proposed Budget announcements only and may not represent final law. Please seek professional advice based on your specific circumstances.
