Budget 2026

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Budget 2026

$1,000 Flat Deduction vs Itemising: Which Wins?

In short: From FY2026-27 (income from 1 July 2026), Australian wage earners can take a flat $1,000 work-related deduction, which the ATO applies automatically, or itemise. If your documented work-related expenses exceed $1,000, itemise and claim the actual total; if they are under $1,000, or you have not kept records, take the flat $1,000. You can switch each financial year.

2026 Budget for Service Sole Traders (PT, Cleaners)

In short: For Australian service sole traders such as personal trainers and cleaners, the headline 2026 Budget change is the permanent $20,000 instant asset write-off, now law. The $1,000 flat deduction applies only to labour income such as wages, not business income. Cash-paid services also sit within the ATO's shadow economy focus, funded with $155.5 million in the 2025-26 Budget.

ATO Shadow Economy Crackdown: What the Funding Targets

In short: The ATO's shadow economy crackdown runs on Australia's 2025-26 Budget funding: $155.5 million over four years from 1 July 2025 targets under-reported income, cash-in-hand work, GST evasion, worker exploitation and illicit tobacco. Another $75.7 million, for personal income tax compliance, adds capacity to match platform and other data against returns. The 2026-27 Budget added $86.3 million for the ATO's Counter Fraud Strategy.

Australian Federal Budget 2026-27: Every Tax Change for Sole Traders, SMBs and Accountants

In short: Australia's 2026-27 Federal Budget (12 May 2026) brought a permanent $20,000 instant asset write-off and a $1,000 flat deduction for wage earners from 1 July 2026. From 1 July 2027, CGT indexation replaces the 50% discount and negative gearing is limited for established residential property bought after Budget night. These four are now law; the proposed 30% discretionary trust minimum tax from 1 July 2028 is not.

CGT Reform 2027: Indexation + 30% Min on Real Gains

The most significant CGT changes 2027 budget has delivered in a generation landed on 12 May 2026 when Treasurer Jim Chalmers handed down the 2026-27 Federal Budget. The change is now law (the Treasury Laws Amendment (Tax Reform No. 1) Act 2026 received Royal Assent on 26 June 2026): from 1 July 2027, Australia's 50% CGT discount is replaced with cost base indexation paired with a 30% minimum tax on real gains, for gains arising from that date. If you hold investment property, a share portfolio, crypto, or any asset that generates a capital gain, the way your profit is taxed is set to change materially. This guide explains what was announced, who it affects, how the mechanics work, and what you can do before commencement.

Client Comms Template: Budget 2026 in Plain English

The right accountant client communication for Budget 2026 goes out within the week, not the month. The Federal Budget was delivered on 12 May 2026, and this post exists for one purpose: to hand Australian accountants a ready-to-send email for each of their main client segments so they can land in inboxes before the mainstream media noise does. Copy the template that matches your audience, replace the bracketed placeholders, and send. The Taxr accountant portal makes the follow-up step (collecting updated expense records from clients who reply) far less painful than it normally is.

How to Claim the New $1,000 Flat Tax Deduction (Step-by-Step)

Here is how to claim the $1,000 flat deduction announced in the Australian Federal Budget on 12 May 2026: confirm you're eligible, total your actual work-related expenses, decide whether the flat claim or itemising gives you a bigger number, then lodge your FY2026-27 tax return accordingly. That is the first year this deduction applies, covering income from 1 July 2026. This guide walks through each of those steps in plain language, with worked examples and answers to the questions that trip people up.

IAWO Recordkeeping Checklist Now It's Permanent

In short: Each claim under Australia's permanent $20,000 instant asset write-off needs seven records: the tax invoice, proof of payment, the asset description and serial number, the first-use or installation date, a business-use percentage for mixed-use assets, an asset register entry and any simplified depreciation election. The ATO says to keep them while you hold the asset and for five years after you dispose of it.

Loss Carry-Back Records Your Clients Need to Keep

In short: From 1 July 2026, Australian companies with aggregated turnover under $1 billion can carry a tax loss back against tax paid in up to two prior income years. Each claim needs five records: the prior-year notices of assessment, a reconciled loss calculation, receipts for major loss-year deductions, a franking account statement and a director-signed narrative of the loss drivers.

Loss Carry-Back Returns: Refundable Losses for SMB

The 2026-27 Federal Budget, handed down on 12 May 2026, restores loss carry back for small and medium businesses, giving eligible companies the ability to convert a current-year tax loss into a real cash refund against income tax paid in the previous two financial years. If your company is heading into a loss year after several profitable ones, this measure could put money back in your account rather than leaving it stranded as a carried-forward deduction.

Medicare Levy Thresholds Increased 2.9% for 2026

The Medicare levy threshold 2026 increased by 2.9% in the Federal Budget delivered on 12 May 2026, extending relief to approximately 1 million low-income Australians who would otherwise pay the full 2% levy on their income. The change is modest in dollar terms for any single taxpayer, but it keeps low-income individuals and families exempt from the levy as their incomes rise.

Negative Gearing Limits 2027: What Investors Lose

The negative gearing changes announced in the 2026 Budget are the most significant restriction on residential property investment in Australia's recent tax history, and they are now law. Announced in the 2026-27 Federal Budget on 12 May 2026 and enacted in June 2026, the change means that from 1 July 2027, investors who purchase established residential property after 7:30pm AEST on Budget night will no longer be able to offset rental losses against their salary or business income. The cut-off is clear: existing property holders are grandfathered indefinitely, new builds remain fully exempt, and the change affects only established dwellings acquired from that point forward. It was arguably the most politically contested element of the entire Budget package.

Permanent $20,000 Instant Asset Write-Off Explained

The permanent instant asset write-off 2026 is now law. The Australian Government announced in its 2026-27 Federal Budget, delivered on 12 May 2026, that the $20,000 instant asset write-off (IAWO) would be made permanent from 1 July 2026, and Parliament has since passed it in the Treasury Laws Amendment (Tax Reform No. 2) Act 2026 (assented to on 26 August 2026). That ends the annual cycle of extensions and sunset clauses that has made planning difficult for small businesses since the scheme was expanded during COVID. If you've been using the IAWO for years without thinking much about it, not much will change day-to-day. But if you've ever delayed an equipment purchase because you weren't sure whether the scheme would still exist next financial year, that uncertainty is now gone.

The New $1,000 Flat Tax Deduction: Who Qualifies

In short: Australia's $1,000 flat deduction for work-related expenses applies from the 2026-27 income year (from 1 July 2026), needs no receipts and has been law since June 2026. It goes to Australian residents for tax purposes who earn assessable labour income, such as salary and wages, director fees or parental leave pay. Sole traders who only earn business income aren't eligible.

Trust 30% Minimum Tax Coming in 2028

The discretionary trust tax changes 2028 are now officially on the table: on 12 May 2026, the Federal Government handed down the 2026-27 Budget and announced a 30% minimum tax on the taxable income of discretionary trusts, proposed to start on 1 July 2028. It is not yet law, but if passed it would be the most significant structural change to family trust taxation in a generation. Around 350,000 small businesses across Australia operate through a discretionary trust.

Trust Restructure Window: How to Advise Clients

In short: As proposed in Australia's 2026-27 Federal Budget, subject to legislation, discretionary trusts would get rollover relief to restructure into another entity, such as a company or fixed trust, from 1 July 2027 to 30 June 2030, ahead of a proposed 30% minimum tax from 1 July 2028. Triage trust clients into four buckets, model stay versus restructure, document the decision and wait for the final legislation before executing.

What the 2026 Budget Means for Australian Tradies

Sparkies, chippies, plumbers, painters: here's what the 12 May 2026 Federal Budget actually changes for your business. The federal budget 2026 tradies conversation usually gets buried under superannuation charts and housing announcements, but several measures land directly on trade businesses: the permanent instant asset write-off (IAWO), a new $1,000 flat tax deduction (for wage earners) and continued ATO enforcement funding aimed squarely at cash-economy work. Payday super, legislated in 2025, also started on 1 July 2026 if you employ an apprentice. This article cuts through the noise to tell you what each measure means in practice, what to do now, and whether the changes actually benefit your specific situation. For a baseline on what you can already claim, see our guide on tax deductions every tradie should know in Australia.

What the 2026 Budget Means for Content Creators

If you make a living (or supplement one) on YouTube, TikTok, Instagram, Twitch, or any other content platform, here's what the 12 May 2026 Federal Budget actually changes for your tax bill. Two measures in the budget papers stand out, the permanent instant asset write-off (IAWO) and a new flat $1,000 deduction, alongside continued ATO compliance funding that keeps platform income in the spotlight. Everything else (the $75k GST threshold, working-from-home rates, sole-trader rules) is unchanged. We have a full breakdown of every deduction available to you in our tax deductions guide for content creators.

What the 2026 Budget Means for IT Contractors

In short: For Australian IT contractors, the 12 May 2026 Federal Budget made the $20,000 instant asset write-off permanent (now law) and brought back loss carry-back for Pty Ltd companies under $1 billion turnover. Payday super applies from 1 July 2026 if your company pays you a director's salary. The $1,000 flat deduction covers only wage or director income, not PSI.

What the 2026 Budget Means for Real Estate Agents

If you sell residential property, manage rentals, or work as a buyer's agent in Australia, here's what the federal budget 2026 real estate changes actually mean, for both your business and the market you operate in. The 12 May 2026 Federal Budget delivers several measures that land on the property sector from two directions: changes that affect your investor and vendor clients (negative gearing limits, CGT reform), and changes that affect your own business operations (the permanent instant asset write-off, plus payday super and ATO compliance funding, which were set before this Budget but land in the same period). Neither set can be treated in isolation. A well-informed agent who understands both sides of these changes will have better conversations with clients, and will end up paying less tax personally. For the full picture of what you can already claim, see our guide on tax deductions for real estate agents in Australia.

What the 2026 Budget Means for Rideshare Drivers

In short: For Australian rideshare drivers, the 2026-27 Budget made the $20,000 instant asset write-off permanent from 1 July 2026 (now law), covering in-car gear but usually not the car itself. The new $1,000 flat deduction doesn't apply to rideshare income, so claim your expenses as usual. Platforms report your earnings to the ATO, which matches them against your tax return.

Working Australians Tax Offset: $250 Explained

The working Australians tax offset 2026 is official: the Federal Budget, delivered 12 May 2026, announced a permanent new Working Australians Tax Offset (WATO) of up to $250, starting from 1 July 2027. More than 13 million workers will benefit automatically, with no separate claim required. Here is what the measure does, who it covers, and how it layers on top of the other tax changes already flowing through from 1 July 2026.