Capital Gains Tax Calculator on Sale of Property 2025-26
Calculate how much capital gains tax you'll pay when selling an Australian investment property. Includes the 50% CGT discount, cost base adjustments, depreciation clawback, and full marginal tax rate analysis.
How the capital gain stacks on top of your regular income and pushes through tax brackets.
How your CGT changes depending on when you sell. The 50% discount applies after 12 months of ownership.
| Sale Year | Holding | 50% Discount | Taxable Gain | CGT Payable | Effective Rate |
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Hold for more than 12 monthsThe 50% CGT discount is one of the most powerful tax concessions available to Australian property investors. Selling even one day before the 12-month anniversary means you pay tax on the full capital gain instead of half.
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Maximise your cost baseKeep records of every legitimate cost: stamp duty, conveyancing, building inspections, capital improvements, loan establishment fees, and selling costs. A higher cost base means a lower taxable gain. Renovation receipts from years ago could save you thousands.
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Time the sale to a low-income yearSince CGT is added to your regular income, selling in a year when your other income is lower (e.g. career break, parental leave, transition to part-time) can result in significantly less tax. The difference between a 30% and 45% bracket on a $100K gain is $15,000.
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Offset gains with capital lossesCapital losses from shares, crypto, or other investments can be offset against your property capital gain. If you have unrealised losses elsewhere in your portfolio, consider crystallising them in the same financial year as the property sale.
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Consider ownership structureIf you purchased jointly with a spouse, each person reports their share of the gain separately. This can keep each person in a lower tax bracket. Future purchases may benefit from being structured via a trust or other entity, depending on your circumstances.
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Settlement date matters, not contract dateThe CGT event occurs on the date of the contract, not settlement. If you sign a contract on 28 June, the gain falls in the current financial year even if settlement is in August. Plan the contract signing date strategically around the end of financial year.
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Book a Free Discovery CallHow Is Capital Gains Tax Calculated on Property in Australia?
When you sell an Australian investment property for more than you paid, the profit is a capital gain and the ATO requires you to pay capital gains tax (CGT) on it. However, CGT is not a separate tax — it is added to your regular taxable income and taxed at your marginal tax rate. This is why understanding your tax brackets is essential when estimating CGT on the sale of rental property.
The calculation starts with your cost base: the original purchase price plus all acquisition costs (stamp duty, legal fees, inspections), any capital improvements made during ownership (renovations, extensions, structural work), and selling costs (agent commissions, marketing, legal fees for the sale). The difference between your sale proceeds and your cost base is your net capital gain.
Capital gains tax on property is calculated by subtracting your cost base (purchase price plus purchase costs, capital improvements, and selling costs) from your sale proceeds. If you've claimed depreciation, that amount is added back. If held for more than 12 months, you apply the 50% CGT discount. The resulting taxable capital gain is added to your other income and taxed at your marginal tax rate.
Australian resident individuals who hold an investment property for more than 12 months before selling are entitled to a 50% discount on their capital gain. This means only half of the net capital gain is added to your taxable income. The discount does not apply to companies, and different rules apply to trusts and super funds.
The cost base includes: the original purchase price, stamp duty, conveyancing and legal fees, building and pest inspection costs, capital improvements (renovations, extensions, structural repairs), and selling costs such as agent commissions, marketing fees, and legal costs associated with the sale.
Yes. If you've claimed depreciation deductions (Division 40 plant and equipment) on your investment property, the ATO requires you to add back (clawback) those amounts to your capital gain when you sell. This effectively increases your taxable capital gain by the total depreciation you've claimed over the ownership period.
Division 43 (building allowance) depreciation is generally not subject to clawback for properties purchased after May 1997. For more information on how tax deductions interact with investment property, see our guide on negative gearing changes in 2026.
Your taxable capital gain is added on top of your regular taxable income. This means the gain may push you into a higher tax bracket. For example, if your salary is $100,000 and you have a $60,000 taxable capital gain, the combined $160,000 is taxed at progressive rates — meaning different portions of the gain may be taxed at 30%, 37%, or even 45%.
Yes, there are several legal strategies: hold the property for more than 12 months to access the 50% discount, keep thorough records of all purchase costs and capital improvements to maximise your cost base, time the sale to a financial year where your other income is lower, offset capital gains against capital losses from other investments, and consider the timing of settlement relative to the end of the financial year.