Capital Gains Tax Calculator

There Is No “Capital Gains Tax Rate”

Capital gains tax is not a separate tax. In the ATO’s own words: “Although it is referred to as ‘capital gains tax’, it’s part of your income tax. It’s not a separate tax.”

There is no separate rate, no separate return and no separate bill. Your net capital gain is added to your taxable income for the year, and the whole lot is taxed on the ordinary marginal rate scale. That means the same gain costs a different amount of tax at each level of other income.

Here is the same $100,000 gain on an asset held more than 12 months, for four people who differ only in their salary:

The “effective rate” column is the closest thing to a CGT rate that exists. It is an outcome, not a published figure. It moves with your income, and a gain large enough to push you into a higher bracket is partly taxed at that higher rate.

This holds for 2026-27. From 2027-28 a floor is added: Australian resident individuals pay at least 30% on gains that build up from 1 July 2027, unless they receive a payment such as the Age Pension that year. See the section on the 1 July 2027 changes below.

How CGT Is Actually Calculated

The ATO sets out eight steps. The calculator above follows them in the same order, and the order changes the result:

1. Work out your capital proceeds: what you received.
2. Work out your cost base: what the asset cost you to buy, hold and sell.
3. Subtract the cost base from the proceeds. Above zero is a gain, below zero is a loss.
4. Repeat for every CGT event in the year.
5. Subtract your capital losses: carried-forward losses first.
6. Check whether you are left with a net gain or a net loss.
7. Apply the 50% discount to whatever remains that is eligible.
8. Report the net capital gain and pay tax on it at your marginal rate.

Losses come off before the discount, not after. This is step 5 before step 7, and reversing them is the most common error in third-party CGT calculators. It always understates the tax. See the worked example below, where getting the order wrong hides $2,250 of gain.

Worked Example: The ATO’s Investment Property

This worked example is the ATO’s own. Rhi buys an investment property for $500,000 and sells it five years later for $600,000:

Now add a second asset. In the same year Rhi also sells shares that cost $10,000 for $5,500, a capital loss of $4,500:

The 12-Month 50% CGT Discount

If you are an Australian resident for tax purposes and you owned the asset for at least 12 months before the CGT event, you halve the remaining gain. Two details decide whether you actually qualify:

• You exclude both end days. The day you acquired the asset and the day of the CGT event do not count toward the 12 months.
• For a contract sale, the CGT event is the contract date: not settlement. Property sales usually work this way, and it also decides which financial year the gain falls in.

There is no partial discount. Eleven months and 29 days gets you nothing; the discount is all or nothing.

The discount is not the same for everyone

Companies cannot use the CGT discount at all, no matter how long they held the asset. That is one reason holding an appreciating asset inside a company is often less tax-effective than holding it personally.

Two other cases change the answer. Providing affordable rental housing can add up to 10%, lifting the discount to as much as 60%. And for assets acquired before 21 September 1999 you may instead index the cost base for inflation, but you cannot use both indexation and the discount.

What Goes in the Cost Base

Your cost base includes more than the purchase price. Every dollar you correctly add to the cost base cuts your capital gain by a dollar. The ATO builds it from five elements:

What you must leave out

The governing rule is simple: you cannot include anything you have claimed, or could claim, as a tax deduction. Double-dipping is the mistake the ATO looks for.

• Any cost you can claim as a tax deduction, including capital works deductions, which reduce the cost base rather than adding to it
• GST net input tax credits, if you are registered for GST
• Expenditure you later recouped, such as an insurance payout or an amount paid by someone else, unless you included it in assessable income
• Heritage conservation expenditure, and land care or water facility spending that gave rise to a tax offset, for assets acquired after 13 May 1997
• Any part of an expense not attributable to acquiring the asset

Capital works deductions go the other way. If you claimed capital works deductions on the building, those deductions reduce your cost base rather than adding to it, which increases your gain. In the ATO’s example, a $100,000 cost base less $7,500 of capital works deductions leaves a reduced cost base of $92,500, turning a $10,000 apparent loss into a $2,500 one. See our tax deductions guide for what you can claim along the way.

One trap on the third element: holding costs like rates, land tax, insurance and interest only go in the cost base where they were not deductible. For a normal rental property you have already deducted them, so they cannot be counted again. They also cannot be used to create or increase a capital loss.

Is Your Home Exempt? Not Automatically

The main residence exemption is the CGT exemption for the dwelling you live in as your home. It is not automatic. To get the full exemption, all three of these must hold:

• The dwelling has been the home of you, your partner and other dependants for the whole period you owned it
• It has not been used to produce income: you have not run a business from it, rented it out, or bought it to renovate and sell at a profit
• It is on land of 2 hectares or less

Fail any one of them and you fall back to a partial exemption, where part of the gain becomes assessable. The usual causes are renting out a room, running a business from home, or buying a place to renovate and flip. Being a foreign resident when the CGT event happens can remove the exemption entirely.

A dwelling is generally your main residence if you and your family live in it, your belongings are there, it is your mailing and electoral-roll address, and services are connected. Vacant land never qualifies: the property must have a dwelling on it and you must have lived in it.

The 6-year rule

When you move out, you can keep treating the property as your main residence:

• Indefinitely, if you do not use it to produce income, for example you leave it vacant or use it as a holiday house.
• For up to 6 years, if you do use it to produce income. This is the “6-year rule”.

While the choice applies you cannot treat any other property as your main residence, except for up to 6 months while you are moving house. The 6 years applies to each separate period of absence: move back in, then leave again, and the clock restarts.

What happens if you exceed 6 years

You are taxed on the portion of the ownership period after the limit, and your cost base resets to the market value when you first used the home to produce income. The ATO’s worked example: an apartment sold for $555,000 with a deemed cost base of $220,000 plus $15,000 of selling fees gives a $320,000 gain. With 6,940 non-main-residence days out of 9,133 ownership days:

If you used part of your home to produce income before you moved out (say 25% as a consulting room), that same proportion of the gain stays assessable, both before and after you leave.

Capital Losses: What They Can and Cannot Do

A capital loss cannot reduce the tax on your salary. Losses offset capital gains only. If you are hoping a bad share year will cut your PAYG bill, it will not.

What losses can do:

• Offset capital gains in the same year.
• Carry forward indefinitely: there is no time limit, to offset future capital gains.
• Be applied selectively. You choose which gains to apply them to, and applying them to gains that are not discount-eligible first gives you the lowest tax.

Some losses are not usable at all. You cannot deduct losses on personal use assets such as boats and furniture, on CGT-exempt assets such as cars and motorcycles, or on low-value collectables. Losses on collectables can only ever offset gains on other collectables.

Which Assets Are Exempt

• Assets acquired before 20 September 1985 (pre-CGT assets)
• Your main residence, where you meet all the conditions
• Cars and motorcycles, a car being a vehicle carrying under 1 tonne and fewer than 9 passengers
• Depreciating assets used solely for taxable purposes, such as business equipment and items in a rental property
• Collectables acquired for $500 or less, and personal use assets acquired for $10,000 or less
• Eligible granny flat arrangements
• Compensation or damages for a wrong, injury or illness suffered by you or a relative
• Winnings or losses from gambling, a game, or a competition with prizes

Exemption cuts both ways: if an asset is exempt from CGT, you also cannot claim a capital loss on it. Assets acquired before 20 September 1985 are pre-CGT and exempt, though improvements made after that date can still be caught. That exemption ends on 1 July 2027: growth up to that date stays tax-free, but growth after it is taxed when you sell. The full list of exempt assets is on the ATO.

Coming 1 July 2027: The Discount Changes

2026-27 is the last full income year of the 50% discount in its current form, but nothing on this page changes yet. The reform applies only to CGT events on and after 1 July 2027, and only to the part of a gain that builds up from that date.

Two Acts received assent on 26 June 2026: the Treasury Laws Amendment (Tax Reform No. 1) Act 2026 (Act No. 49 of 2026) and the Income Tax Rates Amendment (Tax Reform No. 1) Act 2026 (Act No. 50 of 2026). For gains that build up on and after 1 July 2027, they replace the 50% discount for Australian resident individuals and trusts, including partnership gains, with:

• Cost base indexation for assets held at least 12 months. Each cost is grown by inflation: CPI for the quarter you sell divided by CPI for the quarter you paid the cost. Ownership costs such as rates and interest are not indexed. You are taxed on the real gain, not the nominal one; and
• a 30% minimum tax for Australian resident individuals. If the income tax on your post-1 July 2027 gains comes to less than 30% of those gains, you pay the gap as extra tax. It does not apply in a year you receive a payment such as the Age Pension, JobSeeker Payment, Disability Support Pension, Carer Payment or Family Tax Benefit. It does not apply to companies or super funds.

It is not a clean switch-off. An asset you hold through 30 June 2027 is treated as sold that day and bought back on 1 July 2027, at its market value, or by a method the Minister can set instead. You pay nothing on that deemed sale. When you really sell, the gain is split: the part that built up before 1 July 2027 generally gets the old 50% discount, and the part after it gets indexation and the minimum tax. A valuation at 1 July 2027 will matter more than the headline rate.

A discount still applies to:

• the part of a gain that built up before 1 July 2027
• new residential dwellings, unless the investor chooses indexation and the minimum tax instead
• affordable housing, where the discount of up to 60% is kept
• complying super funds, which keep their one-third discount and are outside the reform

These are outside the new indexation regime: companies, complying superannuation entities, life insurance companies, foreign residents, temporary residents. Companies still get no discount, as now.

Not law yet. The Treasury Laws Amendment (Tax Reform No. 3) Bill 2026, introduced on 14 October 2026, is still before Parliament. It proposes:

• a 30% minimum tax on the net income of some discretionary trusts from 1 July 2028
• a discount and indexation for foreign and temporary residents, pro-rated to their days of Australian residency
• no 30% minimum tax on gains of testamentary trusts, deceased estates and special disability trusts
• a legal definition of a new residential dwelling

We have not built the post-1 July 2027 rules into this calculator. Indexation needs the CPI figure for the quarter you sell, which does not exist yet, and the split needs your asset’s value at 1 July 2027. We do not publish figures we cannot check at source. Use this calculator for 2026-27 sales and read the Act itself or the Parliamentary Library bills digest. The ATO’s Capital gains tax reform page (published 13 October 2026) says the first stage “is now law” and that the 2027-28 tax return is the first one it can affect. It also says the Government is still developing the apportionment method, and that the ATO will publish market valuation guidance before 1 July 2027.

Related Calculators

• Income Tax Calculator: your full liability once the gain is included
• Australian Tax Brackets: the marginal rates the gain is taxed at
• Take-Home Pay Calculator: what lands in your account each pay
• Tax Deductions Guide: what you can claim along the way, and why it changes your cost base
• Tax Return Calculator: estimate your refund or bill

Frequently Asked Questions