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Overview
AdviserLogic Holistic Cashflow has been enhanced to automatically model the 2026–27 Federal Budget changes to negative gearing and capital gains tax (CGT). The calculation uses the asset’s acquisition date, value at 1 July 2027, investment property type and ownership to determine the applicable treatment.
The negative gearing restrictions take effect from 1 July 2027. Grandfathering depends on whether the ownership interest was acquired before 7.30 pm AEST on 12 May 2026. The CGT reforms apply to affected gains accruing from 1 July 2027.
⚠️Important
The accuracy of the calculation depends on the information recorded against the asset. Changing the acquisition date, property type, owner or ownership percentage can produce a different tax result.
What has been updated
Three additional input fields are now available in Holistic Cashflow.
Field | Information to enter |
Asset Date of Acquisition | The date the asset was acquired. |
Asset Value as of 1 July 2027 | The asset’s actual or projected value as at 1 July 2027. |
Investment Property Type | Select Residential New Build, Residential Existing Build or Commercial. |
These fields allow Holistic Cashflow to determine the appropriate negative gearing and CGT treatment for the asset.
⚠️Important
Check that the acquisition date, asset value, property type and ownership information are correct before reviewing the projected results. Incomplete or incorrect information may affect the calculation.
📌Note
AdviserLogic automatically indexes the 1 July 2027 cost base using CPI where the relevant CGT calculation applies
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Access
Open an existing or create a new Holistic Cashflow scenario.
You can review assets imported from the Fact Find under Financial Summary > Assets.
Instructions
Navigate to Cashflow > Investments, then open the asset you want to model or select Create New to add an asset.
When creating a new investment asset, select the asset owner and investment type, enter a name for the asset, then select Apply+. For a multi-entity scenario, first choose the relevant individual, trust, company or SMSF from the entity list.
Review the existing asset information
For an investment property, record any associated loan under Liabilities. Enter the interest rate and other loan details against the relevant liability, so Holistic Cashflow can include the interest and related tax effect in the scenario.
Check that the asset’s current value, cost base, income, expenses and other modelling assumptions are complete by selecting the asset and then navigating to the Advanced menu.
Complete the Budget 2026 fields
Enter the additional Budget 2026 information in the asset details.
💡Tip
Retain records supporting the acquisition date, ownership percentage, property classification and 1 July 2027 value. These details can materially affect the projected calculation.
Field | What to enter | How Holistic Cashflow uses it |
Asset Date of Acquisition | Enter the date the ownership interest was acquired. For an asset acquired under a contract, use the date the binding contract was entered rather than the settlement date. | Determines whether a residential property is grandfathered for negative gearing and whether a two-part CGT calculation is required. |
Asset Value as of 1 July 2027 | Enter the asset’s actual or projected value as at 1 July 2027. | Establishes the transition value for the CGT calculation and the starting cost base for gains accruing from 1 July 2027. |
Investment Property Type | Select Residential New Build, Residential Existing Build or Commercial. | Determines whether residential negative gearing restrictions apply and identifies any treatment available to a qualifying new residential dwelling. |
⚠️Important
Where an ownership interest was acquired on 12 May 2026, confirm whether the binding contract was entered before or after 7.30 pm AEST. Keep supporting documentation for the acquisition timing.
In Holistic Cashflow, you can enter the date as MMM-YYYY (Month / Year); therefore, for Assets acquired between 1 May 2026 and 12 May 2026, enter May 2026. For assets acquired between 13 May 2026 and 30 June 2026, enter in June 2026.
Confirm the asset owner
Check the selected owner and any ownership percentages. For jointly owned or split-ownership assets, make sure the percentages accurately represent each owner’s interest.
Where the asset belongs to a trust, company or SMSF, confirm that it has been added to the correct entity.
Holistic Cashflow uses the owning entity when determining the applicable negative gearing and CGT calculation.
📌Note
You cannot move an asset from a personal entity to a company, trust, or SMSF. The asset must be created under the correct entity.
Apply the changes
Select Apply Changes from the bottom of the menu panel to update the asset in the scenario.
Select Save at the top right of the screen to save the scenario.
Holistic Cashflow will recalculate the projection using the updated acquisition date, transition value, property type and ownership information.
Review the calculation
Open the scenario’s table view and review the taxation, cashflow and asset outputs. Pay particular attention to the 2027–28 financial year and the year in which the asset is sold.
For an established residential property acquired after the announcement cutoff, check that excess residential property losses are carried forward from 1 July 2027. For an affected asset held by an individual or eligible trust across 1 July 2027, review the pre-transition and post-transition components of the projected capital gain.
Negative gearing calculations
Holistic Cashflow applies the following treatment based on the asset’s acquisition date, property type and owner.
Asset and owner | Treatment |
Residential property acquired by an individual, trust or company before 7.30 pm AEST on 12 May 2026 | The property is grandfathered. Existing negative gearing treatment continues for both new and established residential properties. |
Established residential property acquired by an individual, trust or company after the announcement cutoff | From 1 July 2027, excess residential property deductions cannot reduce wages, business income or other non-residential income. The unused amount is carried forward and may reduce future residential property income or eligible residential property capital gains. |
Qualifying new residential property acquired after the announcement cutoff | Existing negative gearing treatment continues, subject to the property meeting the requirements for a new residential dwelling. |
Commercial property | The residential property restrictions do not apply. Existing tax treatment continues. |
Property held by a complying SMSF | The negative gearing restriction does not apply to complying superannuation entities. Existing fund tax treatment continues. |
For property acquired after the announcement cutoff but before 1 July 2027, existing negative gearing treatment continues until 30 June 2027. The new restriction applies from the 2027–28 income year.
📌Note
Holistic Cashflow applies the rules across the relevant owner’s residential property income. A carried-forward loss is not necessarily limited to income from the same property.
Capital gains tax calculations
Affected ownership structures
The two-part CGT calculation applies to affected assets held by Australian resident individuals and eligible trusts across the 1 July 2027 transition date.
Owner | CGT treatment |
Individual or eligible trust | An affected asset held before 1 July 2027 and sold on or after that date uses a two-part calculation. |
SMSF | Complying superannuation funds remain under their existing CGT treatment. The Budget 2026 two-part reset and indexation regime does not apply to the SMSF. |
Company | Existing company CGT treatment continues using a non-indexed cost base. Companies do not receive the individual or trust CGT discount. |
The enacted indexation and deemed sale and reacquisition provisions apply to affected individuals and trusts, rather than complying superannuation funds.
Two-part calculation
For an affected asset acquired before 1 July 2027 and sold on or after that date, Holistic Cashflow separates the capital gain into two periods.
Calculation period | Treatment |
Acquisition date to 30 June 2027 | The gain accrued before the transition date is calculated under the pre-1 July 2027 rules. The 50% CGT discount applies where the owner and asset are eligible. |
1 July 2027 to the sale date | The value at 1 July 2027 becomes the starting cost base for the post-transition period. The cost base is indexed using the consumer price index (CPI). |
Post-transition capital loss | The 1 July 2027 transition value is used as the starting reduced cost base. CPI indexation does not increase the reduced cost base when calculating a capital loss. |
An asset acquired on or after 1 July 2027 does not require a two-part calculation because there is no pre-transition ownership period.
📌Note
AdviserLogic automatically indexes the 1 July 2027 cost base using CPI.
Determining the 1 July 2027 value
Asset | Value used in Holistic Cashflow |
Property with a value entered | The amount recorded in Asset Value as of 1 July 2027 is used. |
Property without a value entered | The configured ATO apportionment methodology is applied to estimate the transition value. |
Non-property asset | The projected value as at 1 July 2027 is used in the model. |
💡Tip
When a reliable valuation becomes available, replace any projected property value with the supported value as at 1 July 2027.
⚠️Important
The broader CGT reform also introduces a minimum 30% tax rate for affected capital gains, subject to applicable exemptions. Qualifying new residential dwellings may retain the 50% CGT discount or use the new indexation treatment. Review the scenario output against the client’s circumstances.
Holistic Cashflow provides projected outcomes based on the information and assumptions entered. It does not replace a formal property valuation, tax advice or confirmation of the client’s legal position.
SMSF limited recourse borrowing arrangements
From 10 August 2026, a limited recourse borrowing arrangement (LRBA) entered into to acquire real property can generally only be used for business real property.
This is not a complete ban on SMSF property purchases under an LRBA. Existing LRBAs, refinances of existing arrangements and binding property contracts exchanged before 10 August 2026 are generally unaffected. Residential real property may only be acquired under a new LRBA where it meets the definition of business real property and continues to meet that definition throughout the arrangement.
⚠️Important
Confirm the property classification and contract date before modelling an SMSF property purchase involving an LRBA.
Troubleshooting
Issue | What to check |
The negative gearing result has not changed | Confirm that the projection extends beyond 1 July 2027. Also check whether the property is grandfathered, a qualifying new build, commercial property or held by an SMSF. |
A residential loss is reducing non-residential income | Check the acquisition date, owner and Investment Property Type. An established residential property acquired after the cutoff should have excess losses quarantined from 1 July 2027. |
The CGT calculation is not split | Confirm that the asset is held by an affected individual or trust, was acquired before 1 July 2027 and is sold on or after 1 July 2027. SMSF and company assets do not use this two-part treatment. |
The property uses an apportioned transition value | Check whether Asset Value as of 1 July 2027 is blank. Enter a supported value if one is available. |
Updated results are not visible | Select Apply Changes, save the scenario and confirm that the asset is included in the calculation. |
The result changes after updating ownership | Confirm the entity and ownership percentages. Different tax rules apply to individuals, trusts, companies and SMSFs. |
Important considerations
The core negative gearing and CGT reforms have been enacted, but some implementation details, including the final definition of a new residential dwelling and the prescribed apportionment method, have been addressed through later consultation and legislative instruments.
We may update Holistic Cashflow as those details are finalised.
Current ATO guidance and enacted legislation indicate that complying SMSFs remain under existing CGT treatment, while new property LRBAs are restricted to business real property rather than completely banned. The precise negative gearing cutoff is also 7.30 pm AEST on 12 May 2026, not the whole calendar date.