13/05/2026
๐จ The 2026 Budget Survival Guide: The Good, the Bad, and the "Wait, What?!"
Hey everyone,
Weโve spent the last 24 hours digesting the 2026โ27 Federal Budget, and here at HiCom Accounting, we've come to a conclusion. Itโs a mixed bag: part "helping hand," but mostly "hand in your pocket." Like they always do, they give out a little, and take back a lot more.
Grab a cup of coffee โ๏ธ because this is going to be a long breakdown of exactly what this means for business owners and family taxpayers. Letโs dive in (or don't worry at allโit is what it is, to be honest!).
Since we have family trusts and investment properties ourselves, we are feeling exactly what you are feeling right now. So, we gently request everyone to stay calm and please do not get angry at our lovely, dedicated HiCom staff because of your personal feelings toward the government! ๐
(Note: If you have a family trust, keep an eye out for a specific, tailored update coming to your inbox separately).
Here is the breakdown:
1๏ธโฃ The "Negative" Negative Gearing changes:
๐ The "New Home" Rule: From 1 July 2027, you can only offset property losses against your salary for new builds. Basically, you need to be part of the โbumping stockโ investors entering the market!
๐ Established Homes Quarantined: If you buy an established house after May 2026, those losses are "quarantined" for the future. (Existing properties are "grandfathered," so don't panic sell just yet!). But even if you do sell, it means existing properties are no longer as attractive as new builds. Our existing investments took a hit here.
๐ CGT Makeover: The 50% discount is being replaced by an "Indexation" method from 2027. Here's the kicker: the math just got harder. Even CPAs are saying, โHold on, we donโt know how to do this yet.โ This means your accounting fees for calculating capital gains will likely go up, and your investment margins might be thinner. (Please don't blame us! Personally, after reading this budget, we feel like we should all stop investing our hard-earned income and just go buy lotto tickets ๐๏ธ).
Gains before that date still use existing 50% discount rules.
New-build property investors can choose between the old 50% discount or the new inflation method.
Pre-1985 assets will partially lose their CGT exemption for gains after 1 July 2027.
Investors will pay at least 30% tax on capital gains.
These changes also hit shares and crypto investments! ๐
2๏ธโฃ The "Silver Lining" (Business & Cash Flow)
To stop us all from abandoning the country, the Government threw some benefits back to small businesses:
โ
Loss Carry Back: Hit a rough patch and make a loss in 2026-27? You can claim a cash refund against tax you paid in the previous two years. Itโs a "Tax Time Machine." It means tax planning will be messier for us, but it's great for struggling businesses. (Though it does feel like they take money from businesses doing well and give it to those that aren't. Competence gets punished again!).
โ
Instant Asset Write-off: The $20,000 deduction is now permanent. You can keep buying those "essential" business items and claim them immediately with zero confusion over whether the limit is $20K or $1K this year.
โ ๏ธ Dynamic PAYG-Instalments: From July 2027, you can opt for monthly PAYG or use software to pay tax based on actual sales. This is a very dangerous option. The ATO portal will use an API to connect directly to your Xero, QB, or MYOB to see your sales immediately. Meaning, the anxiety will kick in the moment you create an invoiceโtax is grabbed instantly, even if your client hasn't paid you yet! ๐ธ Your cash flow takes a hit without mercy.
On the bright side: If your sales are dropping, you pay based on real-time worse sales rather than last year's high numbers, saving you from a massive year-end tax bill.
The dark side: The ATO can basically see your accounts naked whenever they want to. ๐ซฃ
3๏ธโฃ The "Admin Alert" & some crumbs they threw in:
๐ Super Clearing House (SBSCH) is Closing: The ATO is shutting down the Small Business Super Clearing House on 1 July 2026. With "Payday Super" coming (paying super on the exact day you pay wages), youโll need to move to a private clearing house (like Xero or MYOB). Don't panic: HiCom will download your payment history before they delete the internet data!
๐ Work Expense "Shortcut": From 2026-2027, workers get a flat $1,000 deduction for work-related expenses without needing a shoebox full of receipts.
๐ Personal tax income cuts: Donโt expect much. For the lowest bracket ($18,200 - $45,000), the rate drops from 16% to 15% in July 2026, and down to 14% in July 2027. Didnโt we say "crumbs"?
๐ New Working Australians Tax Offset (WATO): ~13 million workers will automatically receive a new offset worth about $250/year from 2027-2028. But honestly, for our clients with family trusts now facing a flat 30% tax on distributions... this is just pocket change.
Our Collective Game Plan ๐
The overall picture: If you have a standard setupโa family-owned business, a trust to protect assets and split income to lower-earning members, or flexibility for future kidsโwe are going to have to rethink your structures. Itโs going to be a mess, and being an accountant over the next 2 years won't be fun!
We share your feelings of hurt and confusion. We feel deeply sorry for any families who recently set up a trust! But like we always say, tax advice is only relevant until the "game-changer" government decides, โNah Iโm bored, I want a different game that benefits me more now.โ
โNow what?โ you ask.
Well... please do not flood us with panicked calls right now. ๐
We are already pivoting our strategies behind the scenes. We are running the numbers, testing mock-up scenarios, running trusts through the new brackets, and looking at in-house case studies. (And honestly, looking for a cheaper country to move our businesses to LOL ๐).
We have time. Most of these changes don't hit until 2027 or 2028. We are sending you this email with love and careโyou are in "good hands." If we cannot figure it out, no other accountants out there can do it anyway ๐, so put your faith in the professional minds at HiCom Accounting.
We will run as many tests as it takes to find the best formulas. It won't be picture-perfect, but we will discuss your specific "Family Strategy" and restructuring options (like potentially moving from a Trust to a 25% tax-rate Company) during our next year-end meeting.
Until then, take a deep breath, hug your accountants (virtually), and remember: they can take our 30%, but they can't take our sense of humor.
Happy Wednesday everyone!
Best regards,
HiCom Accounting Team
