Sample tax reform impact report

Sample report

This is the example property running through the live engine. Your own report would replace the inputs.

What we modelled

Sarah and James's Earlwood investment · 42 Bayview Avenue, Earlwood NSW 2206

Currently held as

Joint personal ownership

Established residentialDepreciation onLand tax onTwo sell dates

Property

Purchase price$1,600,000

Settled15/09/2026

Sell date30/06/2027 vs 01/07/2032

Annual rent$76,440

Annual expenses$19,800

StateNSW

CategoryHouse

Loan

$1,200,000 principal + interest at 6.5% (30-yr term)

Loan-to-value ratio 75%

Forecast assumptions

Hold modelled6 years

Property growth5.0%

Rent growth4.0%

Expense growth3.5%

CPI2.8%

Vacancy3.8%

Structures compared

Personal ownership★ Joint personal ownershipDiscretionary trustCompanySMSF accumulationSMSF pension

★ Highlighted is your current ownership. The matrix below shows how each alternative would perform if you switched.

Joint personal ownership·6-year forecast

Your situation today.

Under the proposed reform, your after-tax equity in 6 years lands at $682,281 - a 7.7% reduction from the $739,053 you'd reach under today's rules. That's an after-tax IRR of 5.8% across the hold.

Equity at the end of the forecast

Today's rules

$739,053

Baseline outcome

If reform passes

$682,281

$56,772(−7.7%)lower than today

Cashflow over the hold

Reform costs you $75,402 more across the 6-year hold - almost entirely the lost negative-gearing offset against your other income.

Total under current rules: −$130,863
Total if reform passes: −$206,265
Worst year (under reform): −$114,710Year 5

Year by year

CurrentReform·Δ shown right

−$16,143

−$15,631

−$15,100

−$14,549

−$13,979

Risk profile of joint personal ownership

Reform exposure

How much reform shifts the outcome

Low

Cashflow pressure

How tight the year-to-year cashflow runs

Medium

Compliance complexity

Structure admin and reporting load

Low

Modelled outcome·not advice

CGT exit forecast

What you actually keep after sale

Build-up from purchase price through to net cash in your hand on exit. Uses the reform-side CGT treatment (50% discount where eligible, no discount for company, 33.3% for SMSF accumulation, 0% for SMSF pension). Excludes any restructure costs to move the property in or out of the structure - see the alternative-structure cards for those.

Purchase price

$1,600,000

Buying costs

Conveyancing, stamp duty on acquisition, inspections

$76,000

Capital improvements during hold

$25,000

Less: Div 43 deductions claimed during hold

Cost base reduced by capital works deductions claimed (s 110-25 / s 110-45)

−$97,247

Adjusted cost base

$1,603,753

Forecast sale price

Current value × growth × hold period

$2,122,354

Selling costs

Approx 2.5% of sale price (agent + legal)

−$53,059

Gross capital gain

$465,542

Estimated CGT

After discount eligibility for this structure

−$77,973

Loan balance at sale

−$1,102,776

Net at sale (sale-only)

Equity before tax minus selling costs and CGT

$888,546

Operating cashflow over hold

Cumulative cash drain from the hold (rent minus interest, expenses, etc., net of tax)

−$206,265

Total after-tax position

Sale-only net combined with operating cashflow over the hold

$682,281

Counter-intuitive: reform CGT is lower

Reform CGT here is $77,973 - lower than the $96,602 you would pay if today's rules continued. This isn't a bug. When most of your gain accrues AFTER 1 July 2027, the proposed indexation of the post-2027 cost base shelters more of the nominal appreciation than the lost 50% discount would have. The catch: reform removes the salary-offset benefit from negative gearing, so the NET reform impact is still typically negative once you include the lost tax refunds across the hold (see Section 03).

How reform CGT is calculated

1. Pre-2027 portion. Gain accrued before 1 July 2027 = MV @ 1 Jul 2027 minus cost base (apportioned for selling costs). Taxed at marginal rates with the 50% CGT discount per s 115-100 (33.3% for SMSF accumulation; 0% for company / SMSF pension).

2. Post-2027 portion. Gain accrued after 1 July 2027 = sale price minus the indexed 1-Jul-2027 cost base. The cost base is indexed by CPI (engine uses cpiRate from your forecast assumptions) from 1 July 2027 to the disposal date. The indexed (real) post-2027 gain is taxed at marginal rates with NO discount.

3. 30% minimum-tax floor. The marginal-rate tax on the post-2027 portion is floored at 30% of the indexed real gain. If marginal-rate tax is lower, the floor applies. Floor does NOT apply to the pre-2027 portion. Applies to residential property gains only.

Caveat. All four reform measures (CGT-discount removal, post-2027 indexation, 30% minimum tax floor, negative-gearing restriction) are PROPOSALS as of engine version 3.3.0, not legislated law. Final treatment may differ. Discuss with your accountant.

Unused residential losses carried forward

$200,625

Under the proposed negative-gearing restriction, losses on established residential property are quarantined - they can't offset salary or other income, and they can't convert to capital losses against this property's CGT gain. They can only be applied against OTHER residential rental income in future years. Carries forward indefinitely until used.

Negative gearing impact

Rental cashflow + tax: today vs reform

Side-by-side totals across the full hold. Green Δ = better for you (more income, less expense, bigger tax saving, more cash). Red Δ = worse. The bottom row - after-tax cashflow over the hold - is the line that matters for an investor running this property under both regimes.

Line item	Current rules	Reform	Δ Reform − Current
Gross rental income	$472,205	$472,205	-
Interest expense	−$451,503	−$451,503	-
Operating expenses + land tax	−$143,018	−$143,018	-
Depreciation claimed	−$113,455	−$113,455	-
Taxable property result	−$235,771	−$235,771	-
Tax saving from this property	+$88,677	+$13,275	−$75,402
After-tax cashflow over hold	−$130,863	−$206,265	−$75,402

Property stress test

What happens if conditions move

Same property, same structure, run five times with different interest-rate / rent / vacancy assumptions. Useful for a leveraged investor: rate shocks compound through interest expense, and reform makes negative-gearing offsets smaller, so the downside year is now meaningfully worse than under current rules.

Scenario	Rate	Rent	Vacancy	Total cashflow	Worst year incl. P&I year	Final equity
Base case	6.50%	base	3.8%	−$206,265	−$114,710	$682,281
Interest rate +1%	7.50%	base	3.8%	−$272,297	−$126,710	$616,249 −$66,032 vs base
Interest rate +1.5%	8.00%	base	3.8%	−$305,275	−$132,710	$583,271 −$99,010 vs base
Rent -5% + higher vacancy	6.50%	−5%	7.8%	−$246,646	−$122,717	$641,900 −$40,382 vs base
Property growth -2%	6.50%	base	3.8%	−$199,770	−$112,529	$538,862 −$143,420 vs base
Worst case (rate +1.5%, rent -5%, vacancy up)	8.00%	−5%	7.8%	−$345,449	−$140,717	$543,097 −$139,184 vs base

Break-even thresholds

Where the property tips into the red

Your worst-year after-tax cashflow across the hold is currently −$114,710 (negative). The thresholds below are anchored to that worst year (steady-state, post-reform) - a rent or rate that keeps the worst year non-negative keeps every year non-negative.

Break-even annual rent

$218,603

Gross rent below this turns year-1 after-tax cashflow negative. Interest rate and expenses held at current values.

Break-even interest rate

n/a

Loan rate above this turns the worst-year after-tax cashflow negative. Rent and expenses held at current values. No rate brings the worst year non-negative - typically because the worst year falls in the P&I year, where principal repayment exceeds what rate cuts alone can offset.

Hold vs sell timing

What changes if you sell earlier or later

Same property, same structure, modelled across a range of hold periods. Each row applies the law of the disposal year - horizons landing on or after 1 July 2027 use the proposed reform method (no 50% discount, post-2027 portion indexed, 30% minimum tax floor). Annualised return is the after-tax IRR.

Hold period	Net after-tax equity	CGT at sale law of disposal yr	After-tax IRR
4 years	$574,796 −$107,486 vs your plan	$29,495	4.64%
6 yearsYour plan	$682,281	$77,973	5.78%
8 years	$835,260 +$152,979 vs your plan	$125,871	6.39%
11 years	$1,207,505 +$525,223 vs your plan	$285,396	6.31%

Sale timing comparison

If you sold earlier sale vs later sale

Same property, same structures, two different sell dates. The comparison anchors to 30 June 2027 (earlier sale) and 01 July 2032 (later sale). Each row shows where that structure lands at each date - the law of the disposal year applies, so dates spanning the 1 July 2027 pivot use the post-reform method.

After-tax equity (later sale − earlier sale)

+$1,453,751

CGT delta

+$186,494

Cashflow delta

−$1,631,762

Worth notingMaterial CGT difference

Structure	Earlier sale 30 June 2027	Later sale 01 July 2032	Δ equity
Personal ownership Later sale creates higher nominal value but higher tax drag.	$415,920	$670,878	+$254,958
Joint personal ownership Later sale creates higher nominal value but higher tax drag.	$414,768	$682,281	+$267,513
Discretionary trust Trust result affected by discretionary trust minimum tax timing.	$390,715	$675,676	+$284,960
Company Sale timing changes the outcome under assumptions; review with adviser.	$399,493	$389,539	−$9,954
SMSF accumulation SMSF result is less sensitive to CGT reform under assumptions.	$398,493	$724,281	+$325,789
SMSF pension SMSF result is less sensitive to CGT reform under assumptions.	$398,493	$728,979	+$330,486

Things worth knowing

Items worth understanding before acting on this report - and worth raising with an accountant if you involve one.

Worth knowing

Depreciation using estimated construction cost

No explicit construction cost was supplied. The engine has used your building ratio (42% of purchase price) as the Div 43 cost base. Div 43 is based on the building’s historical construction cost (s 43-70), not today’s purchase price - if today’s price is materially higher than the build cost, the deduction will be over-stated. Enter the figure from a Quantity Surveyor depreciation schedule for accuracy.

Worth knowing

Plant & equipment claim may be disallowed (s 40-27)

For established residential property acquired after 9 May 2017, Div 40 deductions on previously-used plant are disallowed (s 40-27 ITAA 1997). Confirm the plant items are eligible (e.g. immediately new and installed by you) or set the annual figure to $0.

Worth knowing

Proposed measure applied - not legislated

The $1,000 automatic work-related expenses deduction is a 2025 Federal Budget proposal (Treasury, 25 March 2025). It is not yet legislated as of late 2026. Estimates that rely on it should be treated as conditional.

Worth knowing

Land tax based on estimated land value

No unimproved land value was provided, so land tax is estimated as purchase price × land-value ratio. Enter the figure from your council rates notice for accuracy.

Worth knowing

Negative gearing restricted

This property is treated as established residential acquired after Budget night, so net property losses cannot offset salary or non-property income from 2027-28. Unused losses are carried forward.

Worth knowing

Reform-quarantined losses stranded at sale

Under the proposed 2027 negative-gearing restriction, $200,625 of residential property losses have accumulated and cannot offset salary, other income, or this property's capital gain. They carry forward but only against FUTURE residential rental income - so if you sell and don't buy another residential investment, they're effectively wasted. Discuss timing or whether to acquire another rental property with your accountant.

Worth knowing

Trust land tax surcharge applied

A trust-holder surcharge is added on top of the state base rate.

Worth knowing

Trust capital gain streamed to lowest-tax beneficiary

The trust capital gain has been streamed in full to James (lowest marginal rate at base income). Trustees can stream a gain selectively under s 115-227 ITAA 1997, subject to the trust deed. Optimal splits across bracket boundaries are not modelled in v1 - for large gains, an accountant should test split scenarios.

Worth knowing

Carried operating losses released against sale gain

Trust accumulated $307,074 of revenue losses across the hold (no rental profit to absorb them). Per s 36-15 ITAA 1997 (non-corporate carry-forward), subject to Sch 2F ITAA 1936 trust-loss rules, these are released against the capital gain at sale - they reduce the assessable gain before tax is computed. Without this release the losses would be stranded (the entity has no future rental income).

Worth knowing

Franking credits applied at distribution

Fully franked distribution: shareholder grossed-up dividend $734,979, marginal tax $345,440, franking credit $13,296, net shareholder top-up $332,144.

Worth knowing

Div 296 super-balance top-up applied

Div 296 added $4,697 on the portion of earnings attributable to TSB above $3,000,000.

Worth knowing

Div 296 v1 excludes unrealised growth

Div 296 is modelled here against realised assessable earnings only (rental income + capital gain at sale). Treasury’s actual formula uses adjusted-TSB movement including UNREALISED property growth - for high-growth holds the real Div 296 bill can be materially higher than shown. An accountant should re-test against the SMSF’s actuarial Div 296 calc.

High priority

SMSF access restrictions apply

Capital is locked in superannuation until a condition of release is met. SMSF borrowing rules and contribution caps may apply.

Worth knowing

LRBA LVR exceeds market norm

SMSF loan at 75% LVR exceeds the typical 70% cap for residential LRBAs (s 67A SISA). Few lenders write above 70%; significant refinance risk at rate-reset or LRBA fixed-period roll.

High priority

SMSF pension phase compliance

Pension phase 0% tax treatment assumes compliance with transfer balance caps, minimum pension drawdowns and other SIS Act requirements.

Chapter 2 · Compare structures

What if you held this property differently?

Everything above models your current joint personal ownership. Below: how the same property would land in each of the five alternative structures, net of the one-time cost to move it there.

Equity comparison across structures

Each row shows how that structure's after-tax equity compares to your current Joint personal ownership, under the proposed reform. Bars are net of the one-time structure change cost you entered for each structure (CGT, stamp duty, setup, refinance). Bars to the right indicate more equity; bars to the left indicate less. This is a modelled comparison, not advice.

Joint personal ownership

Your current ownership

$682,281

Personal ownership

−$86,404 (−13%)

$595,878(net of −$75,000)

Discretionary trust

−$159,606 (−23%)

$522,676(net of −$153,000)

SMSF accumulation

−$173,000 (−25%)

$509,281(net of −$215,000)

SMSF pension

−$173,303 (−25%)

$508,979(net of −$220,000)

Company

−$443,743 (−65%)

$238,539(net of −$151,000)

Alternative structures

Where this property would land if you held it differently. Each header shows equity and cashflow as % change vs staying put. Open a card for the full breakdown of that structure: how it works, the numbers, the risk profile, and what is worth confirming. These are modelled positions, not advice.

Restructure to

Personal ownership

Negative-gearing offset restricted under reform; single owner pays tax at one marginal rate.

Equity

▼ −13%

Cashflow

▲ +0.6%

How this structure works

One owner pays tax on rent + capital gain at their marginal income-tax rate. Long-term gains (held more than 12 months) get the 50% CGT discount under current rules. Negative-gearing losses can offset salary today, but the proposed 2027-28 restriction stops this for established residential property.

Where you'd land

After-tax equity (net)

$595,878

= $670,878 gross − $75,000 restructure

−$86,404 vs staying put

Cashflow over hold

−$205,113

Money out of pocket across the hold

CGT at sale (reform)

$90,528

vs $109,402 under current law (-17%)

Cost of moving the property here

Structure Change Cost

−$75,000

Stamp duty + CGT trigger + setup + refinance

Net after-tax equity

$595,878

Modelled equity less structure change cost

Net vs staying put

−$86,404

After the cost of getting here

Risk profile

Reform exposureLow

Cashflow pressureLow

ComplianceLow

Worth knowing about this structure

Negative gearing restricted
This property is treated as established residential acquired after Budget night, so net property losses cannot offset salary or non-property income from 2027-28. Unused losses are carried forward.
Depreciation using estimated construction cost
No explicit construction cost was supplied. The engine has used your building ratio (42% of purchase price) as the Div 43 cost base. Div 43 is based on the building’s historical construction cost (s 43-70), not today’s purchase price - if today’s price is materially higher than the build cost, the deduction will be over-stated. Enter the figure from a Quantity Surveyor depreciation schedule for accuracy.
Plant & equipment claim may be disallowed (s 40-27)
For established residential property acquired after 9 May 2017, Div 40 deductions on previously-used plant are disallowed (s 40-27 ITAA 1997). Confirm the plant items are eligible (e.g. immediately new and installed by you) or set the annual figure to $0.
Proposed measure applied - not legislated
The $1,000 automatic work-related expenses deduction is a 2025 Federal Budget proposal (Treasury, 25 March 2025). It is not yet legislated as of late 2026. Estimates that rely on it should be treated as conditional.
Land tax based on estimated land value
No unimproved land value was provided, so land tax is estimated as purchase price × land-value ratio. Enter the figure from your council rates notice for accuracy.
Reform-quarantined losses stranded at sale
Under the proposed 2027 negative-gearing restriction, $200,625 of residential property losses have accumulated and cannot offset salary, other income, or this property's capital gain. They carry forward but only against FUTURE residential rental income - so if you sell and don't buy another residential investment, they're effectively wasted. Discuss timing or whether to acquire another rental property with your accountant.

Worth confirming:

Confirm your marginal rate
Check 50% CGT discount eligibility
Confirm negative-gearing intent

Modelled outcome · not advice

Restructure to

Discretionary trust

Proposed 30% trust minimum tax (1 Jul 2028) caps the streaming advantage.

Equity

▼ −23%

Cashflow

▼ −41%

How this structure works

The trustee can stream rent and capital gains to whichever beneficiary is on the lowest marginal rate that year. The proposed 30% trust minimum tax from 1 July 2028 caps that advantage: the trust group pays whichever is higher - beneficiary tax or 30% of net trust income. A restructure-relief window (Jul 2027 to Jun 2030) lets trusts convert without the floor biting.

Where you'd land

After-tax equity (net)

$522,676

= $675,676 gross − $153,000 restructure

−$159,606 vs staying put

Cashflow over hold

−$290,843

Money out of pocket across the hold

CGT at sale (reform)

vs $26,981 under current law (-100%)

Cost of moving the property here

Structure Change Cost

−$153,000

Stamp duty + CGT trigger + setup + refinance

Net after-tax equity

$522,676

Modelled equity less structure change cost

Net vs staying put

−$159,606

After the cost of getting here

Risk profile

Reform exposureLow

Cashflow pressureMedium

ComplianceMedium

Worth knowing about this structure

Depreciation using estimated construction cost
No explicit construction cost was supplied. The engine has used your building ratio (42% of purchase price) as the Div 43 cost base. Div 43 is based on the building’s historical construction cost (s 43-70), not today’s purchase price - if today’s price is materially higher than the build cost, the deduction will be over-stated. Enter the figure from a Quantity Surveyor depreciation schedule for accuracy.
Plant & equipment claim may be disallowed (s 40-27)
For established residential property acquired after 9 May 2017, Div 40 deductions on previously-used plant are disallowed (s 40-27 ITAA 1997). Confirm the plant items are eligible (e.g. immediately new and installed by you) or set the annual figure to $0.
Proposed measure applied - not legislated
The $1,000 automatic work-related expenses deduction is a 2025 Federal Budget proposal (Treasury, 25 March 2025). It is not yet legislated as of late 2026. Estimates that rely on it should be treated as conditional.
Land tax based on estimated land value
No unimproved land value was provided, so land tax is estimated as purchase price × land-value ratio. Enter the figure from your council rates notice for accuracy.
Trust land tax surcharge applied
A trust-holder surcharge is added on top of the state base rate.
Trust capital gain streamed to lowest-tax beneficiary
The trust capital gain has been streamed in full to James (lowest marginal rate at base income). Trustees can stream a gain selectively under s 115-227 ITAA 1997, subject to the trust deed. Optimal splits across bracket boundaries are not modelled in v1 - for large gains, an accountant should test split scenarios.
Carried operating losses released against sale gain
Trust accumulated $307,074 of revenue losses across the hold (no rental profit to absorb them). Per s 36-15 ITAA 1997 (non-corporate carry-forward), subject to Sch 2F ITAA 1936 trust-loss rules, these are released against the capital gain at sale - they reduce the assessable gain before tax is computed. Without this release the losses would be stranded (the entity has no future rental income).

Worth confirming:

Confirm trust type (discretionary vs unit)
Confirm beneficiary marginal rates
Check the trust restructure-relief window

Modelled outcome · not advice

Restructure to

SMSF accumulation

Sole-purpose, borrowing + Div 296 (>$3M) constraints not modelled.

Equity

▼ −25%

Cashflow

▼ −15%

How this structure works

SMSF holds the property in accumulation phase. Earnings are taxed at 15% and long-term gains effectively at 10%. The proposed Div 296 from 2026-27 adds an extra 15% on the portion of earnings attributable to a Total Super Balance above $3M. Property inside SMSF brings borrowing, audit, sole-purpose and preservation constraints not modelled here.

Where you'd land

After-tax equity (net)

$509,281

= $724,281 gross − $215,000 restructure

−$173,000 vs staying put

Cashflow over hold

−$237,540

Money out of pocket across the hold

CGT at sale (reform)

$4,697

vs $18,464 under current law (-75%)

Cost of moving the property here

Structure Change Cost

−$215,000

Stamp duty + CGT trigger + setup + refinance

Net after-tax equity

$509,281

Modelled equity less structure change cost

Net vs staying put

−$173,000

After the cost of getting here

Risk profile

Reform exposureLow

Cashflow pressureMedium

ComplianceHigh

Worth knowing about this structure

Depreciation using estimated construction cost
No explicit construction cost was supplied. The engine has used your building ratio (42% of purchase price) as the Div 43 cost base. Div 43 is based on the building’s historical construction cost (s 43-70), not today’s purchase price - if today’s price is materially higher than the build cost, the deduction will be over-stated. Enter the figure from a Quantity Surveyor depreciation schedule for accuracy.
Plant & equipment claim may be disallowed (s 40-27)
For established residential property acquired after 9 May 2017, Div 40 deductions on previously-used plant are disallowed (s 40-27 ITAA 1997). Confirm the plant items are eligible (e.g. immediately new and installed by you) or set the annual figure to $0.
Land tax based on estimated land value
No unimproved land value was provided, so land tax is estimated as purchase price × land-value ratio. Enter the figure from your council rates notice for accuracy.
Carried operating losses released against sale gain
SMSF accumulated $253,771 of revenue losses across the hold (no rental profit to absorb them). Per Div 36 ITAA 1997 (general carry-forward) read with s 295-100 (loss quarantine against exempt income), these are released against the capital gain at sale - they reduce the assessable gain before tax is computed. Without this release the losses would be stranded (the entity has no future rental income).
Div 296 super-balance top-up applied
Div 296 added $4,697 on the portion of earnings attributable to TSB above $3,000,000.
Div 296 v1 excludes unrealised growth
Div 296 is modelled here against realised assessable earnings only (rental income + capital gain at sale). Treasury’s actual formula uses adjusted-TSB movement including UNREALISED property growth - for high-growth holds the real Div 296 bill can be materially higher than shown. An accountant should re-test against the SMSF’s actuarial Div 296 calc.
SMSF access restrictions apply
Capital is locked in superannuation until a condition of release is met. SMSF borrowing rules and contribution caps may apply.
LRBA LVR exceeds market norm
SMSF loan at 75% LVR exceeds the typical 70% cap for residential LRBAs (s 67A SISA). Few lenders write above 70%; significant refinance risk at rate-reset or LRBA fixed-period roll.

Worth confirming:

Confirm SMSF Total Super Balance
Check sole-purpose + borrowing rules
Div 296 over-$3M cap

Modelled outcome · not advice

Restructure to

SMSF pension

Pension-phase compliance + access constraints not in this number.

Equity

▼ −25%

Cashflow

▼ −15%

How this structure works

SMSF holds the property in pension phase. Eligible income and capital gains are taxed at 0%. Members must have met a condition of release and the fund must be paying minimum pensions. Div 296 still applies on the >$3M portion. The headline 0% rate is attractive but compliance + access constraints are real and not captured in the equity number.

Where you'd land

After-tax equity (net)

$508,979

= $728,979 gross − $220,000 restructure

−$173,303 vs staying put

Cashflow over hold

−$237,540

Money out of pocket across the hold

CGT at sale (reform)

Cost of moving the property here

Structure Change Cost

−$220,000

Stamp duty + CGT trigger + setup + refinance

Net after-tax equity

$508,979

Modelled equity less structure change cost

Net vs staying put

−$173,303

After the cost of getting here

Risk profile

Reform exposureLow

Cashflow pressureMedium

ComplianceHigh

Worth knowing about this structure

Depreciation using estimated construction cost
No explicit construction cost was supplied. The engine has used your building ratio (42% of purchase price) as the Div 43 cost base. Div 43 is based on the building’s historical construction cost (s 43-70), not today’s purchase price - if today’s price is materially higher than the build cost, the deduction will be over-stated. Enter the figure from a Quantity Surveyor depreciation schedule for accuracy.
Plant & equipment claim may be disallowed (s 40-27)
For established residential property acquired after 9 May 2017, Div 40 deductions on previously-used plant are disallowed (s 40-27 ITAA 1997). Confirm the plant items are eligible (e.g. immediately new and installed by you) or set the annual figure to $0.
Land tax based on estimated land value
No unimproved land value was provided, so land tax is estimated as purchase price × land-value ratio. Enter the figure from your council rates notice for accuracy.
SMSF pension phase compliance
Pension phase 0% tax treatment assumes compliance with transfer balance caps, minimum pension drawdowns and other SIS Act requirements.
LRBA LVR exceeds market norm
SMSF loan at 75% LVR exceeds the typical 70% cap for residential LRBAs (s 67A SISA). Few lenders write above 70%; significant refinance risk at rate-reset or LRBA fixed-period roll.

Worth confirming:

Confirm member is in pension phase
Minimum pension drawdown requirement
Div 296 still applies

Modelled outcome · not advice

Restructure to

Company

No 50% CGT discount - usually worse than personal for high-income owners.

Equity

▼ −65%

Cashflow

▼ −173%

How this structure works

Company holds the property and pays company tax (25%) on rent and the gain. Companies don’t get the 50% CGT discount, so the full gain is taxed inside the company. At disposal the after-tax profit can be paid out as a fully franked dividend; the shareholder pays the gap between company tax and their marginal rate. High-income owners typically end up worse off than personal ownership because of the lost discount.

Where you'd land

After-tax equity (net)

$238,539

= $389,539 gross − $151,000 restructure

−$443,743 vs staying put

Cashflow over hold

−$563,684

Money out of pocket across the hold

CGT at sale (reform)

$13,296

vs $54,443 under current law (-76%)

Cost of moving the property here

Structure Change Cost

−$151,000

Stamp duty + CGT trigger + setup + refinance

Net after-tax equity

$238,539

Modelled equity less structure change cost

Net vs staying put

−$443,743

After the cost of getting here

Risk profile

Reform exposureLow

Cashflow pressureMedium

ComplianceLow

Worth knowing about this structure

Depreciation using estimated construction cost
No explicit construction cost was supplied. The engine has used your building ratio (42% of purchase price) as the Div 43 cost base. Div 43 is based on the building’s historical construction cost (s 43-70), not today’s purchase price - if today’s price is materially higher than the build cost, the deduction will be over-stated. Enter the figure from a Quantity Surveyor depreciation schedule for accuracy.
Plant & equipment claim may be disallowed (s 40-27)
For established residential property acquired after 9 May 2017, Div 40 deductions on previously-used plant are disallowed (s 40-27 ITAA 1997). Confirm the plant items are eligible (e.g. immediately new and installed by you) or set the annual figure to $0.
Proposed measure applied - not legislated
The $1,000 automatic work-related expenses deduction is a 2025 Federal Budget proposal (Treasury, 25 March 2025). It is not yet legislated as of late 2026. Estimates that rely on it should be treated as conditional.
Land tax based on estimated land value
No unimproved land value was provided, so land tax is estimated as purchase price × land-value ratio. Enter the figure from your council rates notice for accuracy.
Carried operating losses released against sale gain
Company accumulated $247,771 of revenue losses across the hold (no rental profit to absorb them). Per s 36-17 ITAA 1997 (corporate-tax-entity carry-forward), subject to Div 165 continuity-of-ownership tests, these are released against the capital gain at sale - they reduce the assessable gain before tax is computed. Without this release the losses would be stranded (the entity has no future rental income).
Franking credits applied at distribution
Fully franked distribution: shareholder grossed-up dividend $734,979, marginal tax $345,440, franking credit $13,296, net shareholder top-up $332,144.

Worth confirming:

Confirm franking strategy
Confirm shareholder marginal rate
Stamp duty / structure setup cost not modelled

Modelled outcome · not advice

New build vs Established

If this property were treated as new vs established

The same property modelled under both classifications. Reform targets investor deductibility differently for new dwellings (negative-gearing restriction relaxed, depreciation eligibility preserved) vs established (more restrictive). The difference below is the policy gap, not a market gap.

As new build

As established

Final after-tax equity

$757,683

$682,281

+$75,402

Total cashflow over hold

−$130,863

−$206,265

+$75,402

Depreciation claimed

Plant + equipment and capital works deductions

$113,455

Tax saving from this property

Positive = saving via negative gearing offsets; green Δ = bigger saving

+$88,677

+$13,275

+$75,402

CGT at sale

Less CGT is better - green Δ = saving

$77,973

Federal vs State property taxes

What this Budget actually controls

Property investors pay both federal and state taxes; this report models the federal layer (income tax, CGT, negative gearing, depreciation). State / local taxes (land tax, stamp duty, council, surcharges) are partially modelled where you enabled them - but those rules are set by state Treasuries, not the federal Budget. Worth keeping straight when reading the impact numbers above.

Federal Budget controls

Income tax (rental income, marginal rates)
Federal Budget - directly affected
Capital gains tax (CGT discount, reform treatment)
Federal Budget - directly affected
Negative gearing rules
Federal Budget - directly affected
Depreciation (capital works + plant & equipment)
Federal Budget - directly affected
Super / SMSF concessional rates + Div 296
Federal Budget - directly affected

State / local government controls

Land tax (per-state progressive schedules)
State Treasury - not federal
Stamp duty on acquisition + transfer
State Treasury - not federal
Council rates
Local government - not federal
Foreign-owner land tax surcharge
State Treasury - not federal
Vacancy taxes (Vic, NSW, ACT)
State / territory - not federal

What this report does not model

Boundaries you should keep in mind

The engine intentionally stops at what it can model with the inputs you provided. Treat the items below as out-of-scope and verify them separately - yourself, or with an accountant or broker - before acting on the modelled numbers.

Restructure costs to MOVE between structures
CGT crystallisation, stamp duty, setup, refinance - collected as an optional per-structure Structure Change Cost input.
CGT events other than A1 (disposal)
Sub-fund elections, rollovers, scrip-for-scrip relief, etc.
GST and the margin scheme
Foreign resident capital gains withholding (FRCGW)
Foreign tax credits + tax-treaty positions
Super contribution caps + transfer balance cap + Div 293
Insurance, owners-corporation levies
Borrowing capacity / lender serviceability assessment
Market cycle / interest-rate path forecasting
Constant rates across the hold; use the Stress test section above for sensitivity.
HELP / HECS / study loan compulsory repayments
Up to ~10% of taxable income for high earners with a study debt. Materially affects net cashflow.
Medicare Levy Surcharge - family thresholds
Engine evaluates MLS per-spouse against the singles tier thresholds (1%/1.25%/1.5%). Family income testing and per-dependant uplifts are not modelled.
Centrelink income testing + Family Tax Benefit
Property income may affect FTB, JobSeeker, parenting payments.
Div 7A loan rules (Pty Ltd structures)
Part IVA general anti-avoidance
Subdiv 855-A (foreign-resident CGT on real property)
Estate planning + testamentary trust consequences
Wage growth / bracket creep over the hold
Taxable income before investment is held constant across forecast years; real-world salaries typically rise.

For your accountant

Full breakdown, year-by-year tables, methodology

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