Eight numbers retirees should know for the current financial year and beyond

What this means: This headline Capital Gains Tax reform, announced in last month’s Federal Budget, aim to ensure investors pay tax on real (inflation adjusted) capital gains accruing from 1 July 2027. The changes will apply to all CGT assets outside super, including property and shares.

It involves replacing the 50% discount on CGT on investments held for more than 12 months with CPI indexation from 1 July 2027 and a new minimum 30% tax on realised capital gains.

Transitional rules will apply for assets purchased prior to 1 July 2027, with the existing 50% individual CGT discount applying to capital gains that accrued up until 30 June 2027. 

Why this matters: From 1 July 2027, where your assets are held will be more important. If you have assets held outside super, depending on your personal circumstances, generally capital gains accrued from those assets will be taxed at a minimum rate of 30% when realised.

What this means: If you receive any Age Pension in the same year you realise capital gains that accrued from 1 July 2027, you will not be subject to the 30% minimum tax rate rule. 

That doesn’t mean you’ll pay no tax on capital gains – rather, your profit will instead be taxed at your marginal income tax rate.

Why this matters: Selling an asset during a financial year in which you qualify for a part- or full-Age Pension payment could help reduce your tax.

If you’re 67 years of age or older and meet the residence rules, whether you receive a full or part Age Pension is decided by two separate means tests – the income test and the assets test – with the test that results in the lower payment being the one that applies.

Learn more about the Age Pension thresholds and limits that apply as of March 2026.

Check your Age Pension eligibility.

What this means: A 33% discount still applies to the capital gains held for more than a year in a super accumulation account. 

That means the super tax rate, which is generally 15%, is then reduced to 10% once the 33% discount is applied.

Why this matters: Holding assets, such as shares, in a super accumulation account, if you’re eligible, may mean you pay less CGT than holding the same assets outside super.

What this means: The tax rate for taxable income between $18,201 and $45,000 will reduce from 16% to 15% on 1 July 2026 (and further to 14% from 1 July 2027).

Why this matters: This will mean savings of up to $268 for taxpayers in 2026-27 and $536 in 2027-28.

What this means: The Government will increase the Medicare levy low income thresholds for singles, families, and seniors and pensioners by 2.9% from 1 July 2025. 

Why this matters: The new thresholds are $28,011 for singles, $47,238 for families, $44,268 for single seniors and pensioners, and $61,623 for senior and pensioner families – which means fewer retirees will need to pay it. 

These thresholds apply in the current financial year to 30 June 2026 and could mean more money in your pocket come tax-time.

What this means: As of 1 July 2026, the general Transfer Balance Cap (TBC) will increase to $2.1 million from the previous limit of $2 million. This cap is the maximum amount of super an individual can move into the tax-free retirement phase to start a pension.

Why this matters: The cap limits how much you can transfer to start a super pension, rather than the amount you can hold in super overall. Any excess can:

• Stay in accumulation phase, where it is generally taxed at up to 15%.
• Be withdrawn, if eligible (subject to super rules and potential tax implications).

Learn more about the TBC or book in for a free consultation with one of our trained guidance consultants.

What this means: The new Division 296 tax on individuals with super balances above $3 million will take effect from 1 July 2026.

An extra 15% tax will be applied to the portion of a member’s earnings attributable to their Total Super Balance (TSB) over $3 million, and a further 10% – bringing the total additional tax on earnings to 25% – will be applied to the portion attributable to their TSB over $10 million.

These rates will apply on top of the existing concessional super fund tax rates.

Why this matters: Whether the balance of any assets you might hold above $3 million are better held in super or outside super will depend on your personal circumstances, including things like your marginal tax rate. 

The top marginal tax rate is currently 45% for income over $190,000.

Australians with total super balances of between $3 million and $10 million could be taxed at 30% on realised earnings attributable to their balance over $3 million; and those with total super balances above $10 million could pay 40% on earnings attributable to their balance over $10 million. 

However, effective tax rates will depend on the assets held and the extent to which other discounts, such as capital gains tax discounts and franking credits, apply. 

What this means: A minimum 30% tax on the taxable income of discretionary trusts will be introduced from 1 July 2028.

It will not apply to other types of trusts including fixed and widely held trusts (such as fixed testamentary trusts); complying superannuation funds; special disability trusts; deceased estates; and charitable trusts.

Why this matters: Up to 23% of Australian families hold assets in a family trust, according to research commissioned by CFS in 2025¹. But the new rules may limit their use for sharing investment income with family members. 

Consider obtaining legal advice on how this rule might affect your personal circumstances or your estate planning.