CPA Australia Tax News

This edition of Tax News was current at the time of publication on May 28. You can subscribe to the Tax News email in your comms preference centre. 

Talking Tax with Jenny

Federal Budget 2026-27 tax changes: CPA Australia advocacy  

The Federal Budget set out some of the most significant tax changes in decades. Two measures in particular, the reforms to capital gains tax and the new minimum tax on discretionary trusts are generating serious concern across the profession.

CGT reforms 

From 1 July 2027, the 50% CGT discount will be replaced with inflation-adjusted indexation, alongside a 30% minimum tax rate on realised capital gains applying to all assets held by individuals, trusts and partnerships.  

No exposure draft legislation has been released, and the technical design gaps in what has been announced are substantial. 

CPA Australia has identified unresolved issues that Treasury must address before this reform can work in practice e.g. how the 30% minimum tax applies before or after the Division 152 small business CGT concessions, interaction of the capital gains flow through and the minimum 30% trust taxation, interaction with employee share schemes, managed investment trusts, and foreign resident withholding and treaty interactions. 

The detail matters. Right now, there isn't enough of it. 

Discretionary trusts 

From 2028-29, distributions from discretionary trusts will be taxed at a new minimum of 30 per cent, a change from the current model which taxes beneficiaries at their individual marginal tax rates. CPA Australia has serious concerns about the equity, complexity, compliance cost, and unintended consequences of this measure.

In particular: 

• the effective tax rate on bucket company structures may reach 70% 
• restructuring is not simply a tax problem — it is a comprehensive commercial disruption requiring renegotiation of employment contracts, leases, supplier and customer contracts, intellectual property assignments, and a cascade of State tax consequences 
• the stamp duty trap extends beyond real estate: in Queensland and Western Australia, stamp duty applies to goodwill, stock, plant and equipment, making restructuring ruinously expensive for ordinary small businesses. 
• GST, FBT, Division 7A, payroll tax, land tax, and reporting entity obligations each create additional barriers or costs that the government has not acknowledged 
• discretionary testamentary trusts currently in probate face profound uncertainty the Treasurer’s assurances do not resolve. 

Since the Budget, CPA Australia has participated in a roundtable with the Assistant Treasurer, maintained regular contact with senior advisers to the Treasurer and Assistant Treasurer, and collaborated with business groups including ACCI and COSBOA. We also delivered a follow-up webinar for members on the major Budget changes. 

This advocacy work is ongoing, and we will continue to provide updates through CPA Tax News as the legislative detail develops.  

If you have questions or feedback, we want to hear from you. Email me. [email protected] 

Jenny Wong
Tax Lead
CPA Australia 

 

Treasury Laws Amendment (Tax Reform No.1) Bill 2026 

Income Tax Rates Amendment (Tax Reform No.1) Bill 2026 

The federal government introduced the Treasury Laws Amendment "CGT and negative gearing” Bill into parliament today. The government bundled the negative gearing and Capital Gains Tax (CGT) reforms alongside other personal tax measures into the bill. The bill is designed to tie these contested housing and asset reforms directly to broader tax cuts to force a unified parliamentary vote.

Key details of the legislation include: 

• Negative Gearing: Limits the ability to negatively gear residential property investments to newly constructed builds only, effective prospectively. 
• CGT Discount: Replaces the existing 50% capital gains tax discount with inflation-adjusted indexation, setting a minimum 30% tax rate on realised capital gains. 
• WATO: The new $250 Working Australian Tax Offset (WATO) 
• S1,000 standard deduction: The $1,000 standard individual tax deduction 

Guidance product library change  

The TPB has simplified its product library structure for easier navigation and use. 

Staying with the TPB, they released resources to support Privacy Awareness Week. 

 

 

ATO website updates

• Infrastructure and stapled structures 
• Private capital program 
• Pillar Two account creation 
• Managing asset for foreign investors 
• Commissioner’s remedial power and superannuation law modification

 

 

SUPERANNUATION AND FINANCIAL PLANNING

Sustainability reporting webinar series  

ASIC and the AASB have announced a series of free online webinars to assist entities in understanding the core concepts underpinning the sustainability reporting requirements. 

• Tuesday 16 June:Introduction to climate science Register now. 
• Thursday 25 June:Climate-related transition risks Register now. 
• Tuesday 30 June:  Greenhouse gas emissions accounting Register now.

In addition, ASIC has released eight interactive e-learning modules on the foundational concepts behind the sustainability reporting requirements. Further guidance is available in ASIC's Regulatory Guide 280 Sustainability reporting (RG 280) and Climate-related Disclosures (AASB S2) 

ASIC sues Equity Trustees   

ASIC has commenced civil penalty proceedings against Equity Trustees Superannuation Limited, alleging failures in care, skill and diligence concerning the decision to allow members to invest in the First Guardian Master Fund (First Guardian)/Investors in First Guardian can access support at takeyoursuperback.com. 

 

 

ATO website updates

• Zone tax offset
• Payday Super contractors

 

PROFESSIONAL DEVELOPMENT

Foundations of Productivity and Efficiency in Finance 

25 June 2026 

This masterclass is designed for experienced finance professionals seeking to strengthen their productivity and efficiency by applying structured approaches to identifying inefficiencies and improvement opportunities across their organisation. 

CPA PD - Foundations of Productivity and Efficiency in Finance - Virtual Masterclass 

 

 

LEGISLATION

PSS maximum benefits for 2026-27 

Superannuation (PSS) Maximum Benefits (2026-2027) Determination has been registered and sets new maximum benefits for the Public Sector Superannuation (PSS) scheme.  


Starting 1 July 2026, the following ceilings will apply:

• Lump sum benefits: $970,000 where the member’s average salary is below $97,000, or 10 times the average salary where the average salary is $97,000 and over 
• AFP pensions: $1,358,000 where the final average salary is below $97,000, or 14 times the average salary where the final average salary is $97,000 and over 

 

RULINGS AND GUIDANCE

Clarification on rental deductions and holiday homes  

Ruling TR 2026/1, with retrospective effect, outlines the ATO's views on rental property income and deductions for non-business individuals, including s 26-50, an integrity measure on holiday homes.  

The ATO also released two companion PCGs: 

• PCG 2026/2 on apportioning deductions where s 26-50 does not apply, using the time-based method or area-based method, or a combination of both, and 
• PCG 2026/3 on the ATO's compliance approach where s 26-50 applies to a holiday home that is rented out. 

In Appendix 2, the ATO undertakes not to devote compliance resources to reviewing whether s 26-50 applies to holiday homes for expenses incurred before 1 July 2026. 

SMSF trustee disqualification guidance    

The ATO updated PS LA 2006/17 Self-managed superannuation funds with expanded guidance on when and how the Commissioner may disqualify an individual from acting as an SMSF trustee. 

The revised practice statement puts into effect: 

• a new statement that an individual may be disqualified under both the contravention and fit-and-proper limbs where the evidence supports both 
• an expanded disqualification process to include allowing a person to wind up their SMSF or appoint an RSE licensee before disqualification 
• more factors relevant to assessing contraventions, including the nature, number and seriousness of contraventions, and risks of permanent asset depletion or illiquidity 

ATO enforcement measures updated     

The ATO updated Practice Statement PS LA 2011/18 which includes expanded guidance on when to issue a departure prohibition order for the collection and recovery of tax-related liabilities and other amounts. 

 

 

CASES 

Interest on sub-trust loans not deductible 

In Cameron v FCT (2026), the Federal Court held that interest payments by a family trust on sub-trust loans were not deductible and that the taxpayers had failed to establish that a valid family trust election had not been made in respect of the trust. 

The Court held that the interest payments were not deductible under s 8-1 of the ITAA 1997 as the sub-trust loans were not incurred in the course of the Family Trust gaining or producing assessable income.

Part IVA applies to solicitor's trust income schemes  

The ART upheld Pt IVA determinations in respect of two series of trust income schemes involving a solicitor but reduced the assessable amounts in respect of the Income Earning Trust schemes (IETs) to reflect the actual loan amounts received by the taxpayer's entities. 

The AAT upheld the Pt IVA determinations, but the Full Federal Court remitted the case to the Tribunal (see Grant v FCT [2024] FCAFC 173). The ART was not persuaded that the taxpayer's counterfactual in respect of the Practice Trust schemes. The ART also rejected the taxpayer's counterfactual that, absent the IET schemes, neither he nor any associated entities would have received any income.

 

NEW ZEALAND TAX NEWS

FBT exclusion for health and safety benefits 

IR explains in QB 26/02 how the FBT exclusion applies for benefits relating to health or safety.  

For the exclusion to apply, there must be a connection between the benefit and the employer's duty to manage risks to health and safety under the Health and Safety at Work Act 2015. 

 

Climate disclosures improving 

The Financial Markets Authority has released its 2026 Climate-related Disclosures Insights Report, reviewing 62 climate statements, noting encouraging progress in reporting practices and a growing maturity across climate reporting entities (CREs).  

The report identifies key areas for improvement in climate statements. These include: 

• More specific physical risk disclosures.
• Stronger data and analysis underpinning physical risk assessments, . 
• Clearer articulation of anticipated impacts, with a direct link to well-defined material climate risks and improved distinction between risks and their impacts. 
• Better linkage between risks and transition planning, including clearer disclosure of how targets and actions (or the absence of these) respond to identified material risks. 
• Improved quality and completeness of greenhouse gas assurance disclosures. 

 

Package to support small businesses 

The government announced a new initiative to provide small businesses with practical tools to improve preparedness and strengthen continuity planning..  

Delivered through the Regional Business Partner Network , this training will include online webinars and in-person workshops across the country, free for eligible enterprises. 

For more information, businesses can contact their local Regional Business Partner. Workshops and webinars taking place between May and August and content will also be available on business.govt.nz.

Loans to help businesses transition away from gas 

The Gas Transition Loan Guarantee Scheme is a Budget 2026 initiative helping businesses transition from gas. Under the scheme, the Crown will guarantee 80 per cent of loans up to $50m if banks agree to lower interest rates for  firms wishing to switch fuel sources. Thousands of businesses use more than 1000 GJ of gas a year, which is the threshold for eligibility for the loan scheme.  

In order to qualify, businesses must achieve genuine gas savings of at least 15 per cent while maintaining or increasing production. The scheme would be available for three years, with loans expected to be repayable within 10 years.  

 

IR website updates 

• Account management service  
• Fewer direct credit letter notifications  

 

 

PROFESSIONAL DEVELOPMENT

Foundations of Productivity and Efficiency in Finance - Virtual Masterclass

25 June 2026 

This masterclass is designed for experienced finance professionals seeking to strengthen their productivity and efficiency by applying structured approaches to identifying inefficiencies and improvement opportunities across their organisation. 

CPA PD - Foundations of Productivity and Efficiency in Finance - Virtual Masterclass 

 

 

RULINGS AND GUIDANCE

Off-market share cancellation  

IR issued TDS 26/04, which summarises a private ruling about whether a share cancellation payment was in lieu of a dividend under s CD 22 or was a dividend under s CD 4, whether the share-for-share exchange limitation in s CD 43 applied, and whether s BG 1 applied to vary these outcomes.  

 

GST on arranging and brokering financial products  

IR issued GST - Arranging and brokering financial products. The draft interpretation statement provides guidance about the circumstances in which intermediaries or brokers involved in the supply of financial products will make an exempt supply for GST purposes by arranging (rather than advising on) any financial services. It explains the meaning of "arranging" and how GST applies to the activities of intermediaries and brokers involved in the supply of financial products. 

Once finalised, the Statement operates alongside Interpretation Statement IS0052 (Financial Planning Fees - GST Treatment), which provides guidance on the GST treatment of financial planning fees.