On Tuesday, 12 May 2026, Treasurer Jim Chalmers handed down the 2026-27 Federal Budget, framing it as an ambitious plan for a volatile global landscape[cite: 34, 35]. Driven by economic resilience and cost-of-living pressures, the 2026-27 Federal Budget introduces sweeping reforms that directly impact property investors, business owners, and discretionary trust structures[cite: 32, 279].

Property Investment in the 2026-27 Federal Budget

The 2026-27 Federal Budget introduces the most significant shift in property taxation in decades, effective 1 July 2027[cite: 294, 313]:

• • Negative Gearing: Deductions will be restricted to "new builds" only[cite: 314, 373].
• • Established Properties: Assets purchased after 7:30 PM (AEST) on 12 May 2026 will have losses deductible only against residential rental income or capital gains[cite: 314, 374].
• • CGT Discount Replacement: The 50% discount is being replaced by cost base indexation plus a 30% minimum tax on net capital gains[cite: 314, 398].
• • Grandfathering: Existing properties held prior to 12 May 2026 are fully exempt from the new negative gearing rules[cite: 314, 384].

Trust & Super Reforms in the 2026-27 Federal Budget

A major focus of the 2026-27 Federal Budget is enhancing the fairness of the tax system through new minimum standards[cite: 441]:

• • Discretionary Trusts: From 1 July 2028, trustees will pay a minimum tax of 30% on taxable income[cite: 429, 442].
• • Restructure Relief: A three-year roll-over relief window begins on 1 July 2027 to assist those moving to a company or fixed trust structure[cite: 429, 475].
• • Division 296: The additional 15% tax on superannuation balances exceeding $3 million commences in the 2026-27 income year[cite: 263].

2026-27 Federal Budget: Small Business Incentives

The Government is providing critical cash flow support for businesses[cite: 582]:

• • $20,000 Instant Asset Write-Off: This incentive for businesses with turnover under $10 million is now permanent as of 1 July 2026[cite: 556, 575].
• • Monthly PAYG: From 1 July 2027, SMEs can opt for monthly PAYG reporting to better align with real-time business activity[cite: 556, 579, 582].
• • Loss Carry Back: Reintroduced for companies with turnover under $1 billion from 1 July 2026[cite: 664, 675].

For more details on official business measures, visit the Australian Taxation Office (ATO).

Relief for Workers in the 2026-27 Federal Budget

• • Working Australians Tax Offset (WATO): A permanent $250 offset begins in 2027-28, effectively raising the tax-free threshold[cite: 483, 490].
• • $1,000 Standard Deduction: An "instant" deduction for work-related expenses is proposed for the 2026-27 income year[cite: 498, 510].
• • Personal Tax Cuts: Significant reductions to the 16% bracket are scheduled for 1 July 2026 and 1 July 2027[cite: 204].

View the full 2026-27 Federal Budget papers here.