Free calculator — draft formula, August 2026
1 July 2027 property value: valuation vs formula
Your property's value on 30 June 2027 decides how much of your gain keeps the 50% CGT discount. See how a market valuation and Treasury's draft formula each split the gain, and the tax difference in dollars.
The date on the contract, not settlement.
Stamp duty, legal and conveyancing fees. Use 0 if you don't know.
With your valuation
With the draft formula
Draft — not finalTax difference
$22,716 less tax with the draft formula
What the numbers mean
The draft formula assumes the property grew at one steady rate from the day you bought it to the day you sell — here 3.6% a year — and works out what it would have been worth on 30 June 2027 at that rate: $920,272. Your valuation puts it at $850,000.
That 30 June 2027 figure decides how your gain is split. The part before it keeps the 50% discount. The part after it is reduced for inflation (indexation) and the rest is taxed in full, with a 30% minimum. So a higher 30 June 2027 figure isn't always lower tax: if the property grows at about the rate of inflation after 2027, that later growth is mostly untaxed anyway.
The formula only grows the purchase price. Buying costs and improvements count in your cost base, but don't raise the formula's 30 June 2027 figure. Improvements made after 1 July 2027 still raise your sale price, which the formula spreads back across every year you owned the property.
These are estimates only — not financial, tax or investment advice. The formula is Treasury's exposure draft from August 2026 and may change before it is final. Assumes inflation of 3.5% a year for indexation, treats other income as salary, and leaves out selling costs, the income-support exemption from the 30% minimum tax, and the new-build choice. Not for your main residence, which is generally exempt from CGT.
Two ways to find the 30 June 2027 value
The Treasury Laws Amendment (Tax Reform No. 1) Act 2026 treats every property you own on 1 July 2027 as sold just before that date and bought straight back. Nothing is taxed then. When you really sell, your gain is split at the 30 June 2027 value: the part before keeps the 50% discount, the part after is reduced for inflation and taxed with a 30% minimum.
The default is the property's market value just before 1 July 2027. Instead, you can choose a method set by the Treasurer. The draft method works only from your purchase price, your sale price and how many days you owned the property.
How the draft formula works
- Divide the sale price by the purchase price. This is the total growth.
- Count the days you owned it, from purchase to sale, and from purchase to 30 June 2027 (both days included).
- Find the steady daily growth rate that turns the purchase price into the sale price over all those days.
- Grow the purchase price at that rate up to 30 June 2027. That's the formula's value.
Example: a property bought for $500,000 on 1 July 2017 and sold for $1,000,000 on 30 June 2037 doubled over 7,305 days. 3,652 of those days fall up to 30 June 2027, so the formula's value is $500,000 × 23,652 ÷ 7,305 = about $707,073 — not the roughly $750,000 a straight line would give. Steady compounding puts less of the growth in the early years.
Important
Questions people ask
What is the draft apportioning formula?
It's a way to work out a property's value on 30 June 2027 without a valuation. Treasury's draft divides your sale price by your purchase price, assumes the property grew at that one steady rate every day you owned it, and works out what it would have been worth on 30 June 2027 at that rate. That figure then splits your gain: the part before 1 July 2027 keeps the 50% CGT discount, the part after uses indexation and the 30% minimum tax.
Is the formula law yet?
No. The law (the Treasury Laws Amendment (Tax Reform No. 1) Act 2026) lets you choose between market value just before 1 July 2027 and a method the Treasurer sets in a legislative instrument. Treasury released an exposure draft of that instrument for consultation from 3 to 21 August 2026. It can change before it's made, so the formula figures here are draft only.
Which assets can use the formula?
Under the draft, real property, plus assets that don't have a readily ascertainable market value on 30 June 2027 — for example some private company shares or artwork. Listed shares and ETFs aren't covered, because their closing price on 30 June 2027 is easy to find.
Why doesn't a higher 30 June 2027 value always mean less tax?
A higher value moves more of the gain into the pre-2027 part, which keeps the 50% discount. But the post-2027 part has its cost base raised for inflation, so growth that only keeps pace with inflation after 2027 is largely untaxed. If a property grows at about the rate of inflation after 2027, a lower 30 June 2027 figure can mean less tax. The calculator shows which way your numbers fall.
How do stamp duty and renovations change the formula?
The draft only grows the purchase price. Stamp duty, legal fees and improvements made before 1 July 2027 are added to your cost base, which lowers the pre-2027 gain, but they don't raise the formula's 30 June 2027 value. Improvements made after 1 July 2027 still lift your sale price, which the formula spreads back across your whole ownership, so it puts more of their value before the cut-off than a valuation would.
When is the choice made?
Under the Act, you choose when you lodge your tax return for the year you sell. Nothing is taxed on 1 July 2027 itself: the pre-2027 gain is held over and taxed in the year of the real sale, together with the post-2027 gain.
Where these numbers come from
The rates and thresholds in this calculator come from these official sources:
- Treasury Laws Amendment (Tax Reform No. 1) Act 2026 — as made
- Treasury — exposure draft: Method for Apportioning Capital Gains and Capital Losses Determination 2026
- Treasury — draft explanatory statement, with worked examples
- Treasury — CGT and negative gearing tranche 2 consultation (August 2026)
- ATO — tax reform: negative gearing and capital gains tax
- ATO — individual income tax rates