Accountant, Broker & Buyer's Agent Build a Property Portfolio Under the New Rules | Ep. 3

Three main changes that happened.

One is obviously them limiting the 50% CGT discount.

They're removing that from the 1st of July, 2027.

And... putting in something called indexation.

Indexation is basically, instead of giving them a 50% discount, moving forward, the cost base of the capital gains calculation is going to remove any growth for inflation.

So that's how they're going to calculate it.

It's very confusing.

Yeah.

now it's an old system isn't it which most accounts don't even know how to do it now

that's me when i first started uh it was in like a couple years and i was like what the freak was happening i think i was actually trying to do the calculation did it wrong and my senior accountant just said to me dory david i'll take over and i never saw it ever again it got removed after a year or two years now the reason being is because it's actually very complicated because The growth rate is different every single year.

So you have to recalculate it.

And if you spend more money on the property every single year, because now negative gearing doesn't apply anymore, which is the second change, that would then be added to the cost base.

It could be added to the cost base if it's a loss.

then the result means that that is also inflation impacted as well.

Because it's

inflation rate by another inflation rate by another inflation rate.

Every single year.

But that's changing every single year.

Yeah, so every single year it changes.

So the

1st of July, 2027, everyone gets their properties valued.

And then from there, it's just indexed in terms of the next year, this is how much you have to pay.

That's if you own a property previously.

If it's grandfathered.

That's a problem in itself.