What the 2026 Budget means for your super

Tonight’s Federal Budget delivers significant changes to superannuation, capital gains tax and trust arrangements, with important implications for retirees and self-funded investors.

Key takeaways:

• Superannuation tax concessions tightened for large balances. The Government is proceeding with its plan to reduce tax concessions for individuals with total superannuation balances above $3 million. Those with balances below this threshold are unaffected.

• Low Income Superannuation Tax Offset boosted. Around 1.3 million Australians on lower incomes will benefit from an increased offset, improving equity within the super system.

• Capital gains tax overhauled from 1 July 2027. The existing 50% CGT discount will be replaced with cost-base indexation and a 30% minimum tax on real capital gains. Critically, transitional arrangements mean the new rules only apply to gains arising after 1 July 2027 — existing investments are largely protected. The main residence exemption and superannuation tax arrangements are explicitly preserved.

• Negative gearing limited to new builds — but existing investors grandfathered. From 1 July 2027, negative gearing on residential property will only apply to new builds. However, properties held as of tonight (7.30pm AEST, 12 May 2026) are exempt — existing investors are unaffected.

• Discretionary trust minimum tax introduced. From 1 July 2028, a 30% minimum tax will apply to discretionary trusts. Complying superannuation funds are explicitly excluded. Rollover relief is available for those wishing to restructure before the rules take effect.

• Deeming rates — no new changes announced tonight beyond previously legislated settings. 

What this means for retirees: Self-funded retirees with investment properties acquired before tonight are protected by the negative gearing and CGT grandfathering provisions. Those with super balances under $3 million face no new concession changes. Retirees using discretionary trusts for estate planning should seek advice ahead of the 2028 commencement date, although fixed testamentary trusts remain unaffected.