Federal Budget 2026–27 – What It Means for You
General
| May 13, 2026
Federal Budget 2026–27 – What It Means for You
The Federal Budget was announced on 12 May 2026. While there were no major surprises, there are some important changes – especially around tax, property investing, and super – that could affect everyday Australians and families.
You don’t need to understand every technical detail – but it’s important to know what could impact your finances, your plans, and your future. Importantly:
- Most announcements are proposed changes (not law yet)
- Super hasn’t changed significantly, but remains a very tax-effective way to save for retirement
- Several tax and property-related changes could affect investors and working families
Tax & Cost of Living Changes
The first personal marginal tax tier of 16% drops to:
- 15% from 1 July 2026
- 14% from 1 July 2027
What it means: Slightly more money in your pocket over the next two years.
- New $1,000 ‘no receipts’ deduction
- You can claim up to $1,000 in work expenses without receipts.
What it means: Simpler tax time (especially for employees working from home or using their car for work).
- $250 tax offset.
- From 1 July 2027, eligible workers get up to $250 off their tax.
What it means: A small but helpful annual tax saving (only applies if you earn income from work).
Property Investors – Key Changes
Capital Gains Tax (CGT) changes (from 1 July 2027)
- Current 50% discount will be removed for future gains
- Replaced with inflation (CPI) indexation
- A minimum 30% tax rate will apply to gains
What it means:
- Property and shares may become less tax-effective over time
- Existing investments are partially protected, but new investments may be impacted more
Negative gearing changes
From 1 July 2027, new investment properties:
- Losses can’t offset your salary
- Losses are carried forward to future years
What it means:
- Property investing may become less attractive for tax purposes
- Existing properties are generally grandfathered (no change)
Superannuation Updates
Contribution limits increasing
From 1 July 2027, contribution/superannuation caps increase:
- Concessional cap: $30,000 → $32,500
- Non-concessional cap: $120,000 → $130,000
- Transfer Balance Cap (Pension Cap): $2m → $2.1m
- Total Super Threshold: $2m → $2.1m
What it means: More opportunity to boost super savings in a tax-effective way
Pay-day super (from 1 July 2026)
Employers must pay super at the same time as your wages
What it means: Your super is invested earlier and more often, helping it grow faster
Electric Vehicles (EVs)
- Current FBT exemptions for EVs will be reduced over time
- Full exemption only applies to vehicles under $75,000 from April 2027
What it means:
- EV salary packaging is still attractive, but benefits are tightening
Government Support Changes
Small Business Owners
- $20,000 instant asset write-off (now permanent)
- Businesses under $10m turnover can immediately deduct assets under $20k
What it means: Continued flexibility to invest in equipment and reduce tax.
Private health insurance
Higher rebates for over 65s will be removed
What it means: Health insurance may become more expensive later in life
Aged care & home support
Some improvements:
- No out-of-pocket costs for basic personal care at home
- More funding for aged care facilities
What it means: Better support for older Australians needing care
Action (What you should consider)
You don’t need to act immediately – but it’s worth reviewing:
- Your investment strategy (especially property)
- Your tax planning approach
- Whether you can boost super contributions
- Whether structures like trusts or companies still suit your needs
If you’re unsure how these changes affect you, please feel free to contact the office.
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