Should you buy business premises before the 1 July 2027 CGT change?

There’s a line going around: “Buy your premises before 1 July 2027 or you’ll lose the CGT discount.” It sounds like a hard deadline. It isn’t. The new rules start that day, but they only apply to growth that happens after that day. Gains built up before then keep the old treatment. A purchase rushed into the first half of 2027 shelters a few months of growth, and that’s all.

So the 1 July 2027 date isn’t a reason to buy now. It isn’t a reason to wait either. This guide shows why, puts the tax slice next to the numbers that actually matter, and covers the cases where timing around the change does deserve a conversation with your accountant.

What is changing on 1 July 2027?

The Treasurer announced on 25 June 2026 that the tax reform bill had passed Parliament. For capital gains tax, it does three things that matter to a business owner thinking about property:

1. The 50% discount goes, for new growth. From 1 July 2027, resident individuals, trusts and partnerships lose the flat 50% discount on gains that build up from that date. The ATO’s reform page explains that cost base indexation takes its place, so only the growth above inflation is taxed.
2. A minimum tax arrives. Individuals face a minimum 30% tax on certain net capital gains.
3. More small businesses qualify for a concession. The turnover threshold for the 50% active asset reduction rises from $2 million to $10 million.

The second stage of the legislation, covering trusts and other edge cases, was still being finalised when we wrote this. Treat the broad shape as settled and the fine print as something to confirm.

Does buying before 1 July 2027 lock in the old discount?

Only for the growth before that date. This is the part the “buy now” line gets wrong.

Treasury’s small business explainer says the change is “entirely prospective”. Value built up before 1 July 2027 keeps the 50% discount, whenever you sell. In practice, the property’s value on 1 July 2027 becomes the dividing line. Growth below that line is taxed under the old rules. Growth above it is taxed under the new ones.

Now picture two owners buying the same building:

• Owner A buys in February 2027. The growth from February to the end of June gets the old discount. Everything after that, which could be ten or twenty years of growth, falls under indexation and the minimum tax.
• Owner B buys in September 2027. All of their growth falls under the new rules.

The only difference between them is about five months of growth. On most business premises, that’s a small slice of the total gain, so the tax difference is a small slice of that.

And the new rules aren’t always worse. Indexation means growth that only keeps pace with inflation isn’t taxed at all. If a property’s value tracks inflation closely, the gap between the two systems on that slice shrinks further, and it can even favour the new rules.

Is my premises held the right way for this to matter?

Ownership structure changes the picture more than purchase timing does.

Who owns the premises	Effect of the 1 July 2027 change
A company	None from this part. Companies have never had the 50% discount.
You personally, or with a partner	Discount replaced by indexation for growth from 1 July 2027; minimum tax applies to individuals
A discretionary (family) trust	Same discount change, plus a separate minimum tax on discretionary trusts planned from 1 July 2028
A self-managed super fund	Ask your adviser. Super funds have their own CGT settings.

If you’re about to buy, the structure question is worth far more of your accountant’s time than the date question. It affects tax for as long as you own the building, not just for one financial year.

If you’ve weighed it up and the property case is strong, you can see whether you qualify in about a minute. Asking doesn’t touch your credit file.

What actually decides whether to buy now or later?

Take the CGT date out of the picture and the decision looks like any other now-or-later call. Put dollars against dollars:

The cost of waiting:

• Rent you keep paying while you wait.
• A lease expiry, renewal option or rent review coming up. Our guide to lease option deadlines walks through that decision.
• The right building in the right spot. Industrial units near your customers or a shopfront on your strip don’t come up often.
• Fit-out work you’re holding off on because you don’t own the walls.
• Price movement while you wait, in either direction.

The cost of buying now:

• The total dollar cost of finance over the time you’ll hold it: establishment fees, ongoing fees and interest added up.
• Stamp duty, legal and valuation costs.
• Cash tied up in the deposit that the business might need for stock, wages or the next BAS.

Our cost-of-waiting calculator lets you set the first list against the second. If the property only makes sense because of a tax deadline, that’s a warning sign, and the same logic as buying just to save tax applies.

Worked example: the joinery and the factory unit

Illustrative only. Invented figures, no real business.

A joinery rents a factory unit for $78,000 a year. Their lease ends in March 2028. A similar unit two streets away is listed for $1.3 million in February 2027. The owners hear the “buy before July” line and start to panic.

The CGT slice. Say the unit grows by about $20,000 between February and the end of June 2027. That $20,000 is the only growth that rides on the old discount. Whatever the exact tax difference between the two systems on that slice, it’s a few thousand dollars at most, and it would only arrive when they sell, possibly decades away.

The rent. Buying in February rather than September saves about seven months of rent, around $45,500. Against that, they start paying finance costs seven months earlier, plus stamp duty and fees either way.

The real driver. The owners don’t want to be hunting for premises with six months left on the lease, and units like this rarely come up in their area. Two years of order books show steady demand.

Decision: buy, but for the location and the lease timing, not the tax. If the unit had been badly placed or overpriced, the CGT slice would never have justified it. They also ask their accountant whether to buy personally, through a trust or through a company, because that choice is worth far more than the five months.

When does waiting win?

Comfortably, in plenty of cases:

• You’d be stretching to buy. If the deposit drains the working capital you need for stock or wages, a few months’ delay costs less than a cash-flow squeeze.
• The property is second-best. Paying for the wrong building early to save a few thousand in future tax is a bad trade.
• Your lease has years to run at a fair rent and nothing is pushing you.
• Trading is uneven. A lender will want to see the business carry the repayments. Two more strong quarters make a better application. Our page on when waiting is smarter has more on this.
• The structure question isn’t settled. Buying in the wrong name can cost far more than the CGT slice, and it’s hard to undo.

What if I already own my premises?

Then 1 July 2027 is a record-keeping date, not a buying or selling deadline.

• Don’t rush a sale. Treasury says pre-July 2027 gains keep the 50% discount whenever you sell.
• Think about a valuation around that date. Since the 1 July 2027 value is the dividing line, a sound record of it may help when you eventually sell. Ask your accountant what evidence they’d want.
• Check the concessions. If your turnover is between $2 million and $10 million, the higher threshold for the active asset reduction from 1 July 2027 could change the tax on a future sale. Talk it through before you set a sale date.
• Equity is still equity. Owned premises can also secure finance for other plans, such as fit-outs, equipment or a second site. See expanding now or waiting for the timing side.

How do I plan a purchase sensibly from here?

If buying premises in the next year or so is on your list, work backwards from the date that actually matters, which is usually your lease, not 1 July 2027:

1. Now to December 2026: get your accountant’s view on the ownership structure and how big a deposit you can afford.
2. Before you make an offer: get your documents ready. That means recent bank statements, financials or BAS, ID and details of existing debts, plus property details if you’ll use other equity as security.
3. At the offer: allow for the valuation, legal steps and any cooling-off or finance clause in the contract.
4. Before settlement: line up the fit-out and moving dates around your trading calendar.

Our guide to working back from your deadline sets out the full timeline method.

Found the right building? Let’s see if the numbers work

Most owners who ask us about the CGT change have already found a building they like, or they can see their lease running out. The tax date is just what made them pick up the phone. That’s fine. What matters is whether the property suits the business and whether the repayments sit comfortably beside your wages, super and BAS.

That’s what we look at. Property-secured business loans run from $20,000 to $5,000,000, and equity in other property can often help with the deposit. The enquiry takes about 60 seconds and won’t affect your credit score, because there’s no credit check just for asking. We don’t send your details to a pile of lenders, so your phone won’t fill up with strangers. A real person reads your situation and calls you. If they think waiting for a better building or another couple of strong quarters is the smarter move, they’ll say so.

Please fill the form in accurately: the purchase price, your deposit or equity, what the business turns over and any ATO balance. Then the first option we show you is one that fits.

See if you qualify →