Why use this calculator
Capital gains tax is decided by things you control, when you sell, what you count in the cost base, whether you have losses to apply, and most of those decisions are irreversible once the contract is signed. Selling at eleven months instead of thirteen can double the tax on the same gain, because the fifty per cent discount turns on a single date.
This calculator prices the sale before you commit, shows what the discount is worth, and makes clear that the gain is added on top of your salary rather than taxed at a flat rate, which is why a large gain in a high-income year costs far more than the same gain in a low-income one.
How to use it
- Enter what you paid and what you expect to sell for, then fill in the costs, because they are what most people leave out and they reduce the gain directly.
- Buying costs include stamp duty, conveyancing and inspections; selling costs include agent commission and marketing.
- Capital improvements are structural work like an extension or a new kitchen.
- Ordinary repairs and maintenance are deductible against rental income instead and must not be counted here.
- Months held runs from contract date to contract date, not settlement.
- Other income matters because the gain stacks on top of it, and carried-forward losses from previous years are applied before the discount.
What each result means
- Capital loss
- How much less you received than the asset cost you, after costs. No tax is payable, and the loss can be used against capital gains this year or carried forward.
- Net proceeds after selling costs
- The sale price less agent, legal and other selling costs, which is the cash the sale actually brings in before any tax.
- Capital gains tax payable
- The extra tax caused by the sale, calculated as the difference between your total tax with and without the gain included.
- Profit after tax
- The gain you actually keep: sale price less selling costs, less your cost base, less the capital gains tax on this sale. This is the figure to compare against other uses of the money.
- Waiting for the 50% discount saves
- The tax you would save by holding the asset until you have owned it for more than twelve months, so the 50% discount applies. It assumes the price and your other income stay the same.
- Sale price to break even
- The sale price at which you recover everything you put in, being the purchase price, buying costs, improvements and selling costs. Above this you make a capital gain; below it, a capital loss.
- Gross capital gain
- Net proceeds less cost base, before losses and before the discount. This is the raw profit on the asset.
- Cost base
- Everything that counts as the cost of owning the asset: purchase price, buying costs and capital improvements. A larger cost base means a smaller gain.
- Losses applied
- Capital losses from this or previous years used against the gain. They are applied before the discount, which maximises their value.
- 50% discount
- The reduction available to individuals on assets held more than twelve months. It is the single largest lever in the whole calculation.
- Taxable gain added to income
- What actually goes onto your tax return and is taxed at your marginal rate alongside salary.
- Your income including the gain
- Total taxable income for the year. A large gain can push you into higher brackets, which is why timing matters.
- Effective tax rate on the gain
- Tax paid as a share of the gross gain. With the discount this is usually around half your marginal rate.
- Net proceeds after tax
- What is left from the sale after selling costs and capital gains tax, before repaying any loan secured on the asset.
The formula
Capital gain equals sale proceeds less selling costs, less the cost base (purchase price plus buying costs plus capital improvements). Carried-forward capital losses are subtracted first. If the asset was held for more than twelve months, the 50% discount is applied to what remains. The discounted gain is then added to your other taxable income and taxed at your marginal rates, so the tax payable is the difference between your tax with the gain and your tax without it.
How this number is used in practice
The twelve month rule is the most valuable date in Australian investing. An asset sold at day 360 is taxed on the full gain; the same asset sold at day 370 is taxed on half of it. On a $200,000 gain at a 37% marginal rate, waiting a few weeks is worth around $37,000. The clock runs from contract date to contract date, so settlement timing does not save you.
Timing across financial years is the second lever. Because the gain stacks on top of other income, realising it in a year when you are on parental leave, between jobs, or newly retired can move it into much lower brackets. Spreading a large share portfolio sale across two financial years achieves the same thing for people who can wait.
The main residence exemption removes CGT from the home you live in, but the edges catch people. Renting out part of a home, using a room exclusively for a business, or moving out and renting the property all trigger partial liability. The six-year rule can keep the exemption alive after moving out, provided you do not claim another property as your main residence at the same time.
Worked examples
Investment property bought for $400,000, sold for $650,000 after three years
Gross gain around $215,000 after costs, halved by the discount to about $107,500 of taxable gain, producing tens of thousands in tax at a 37% marginal rate.
The same property sold at eleven months
No discount applies, so the full $215,000 gain is taxable instead of $107,500. Roughly double the tax for selling a few weeks earlier.
Shares bought for $30,000, sold for $50,000 after two years with $5,000 of carried losses
Losses reduce the $20,000 gain to $15,000 before the discount halves it to $7,500 of taxable gain.
When people use it
- Deciding whether to wait past twelve months before selling
- Choosing which financial year to realise a gain in
- Working out what carried-forward losses are worth against a planned sale
- Checking how much of a sale price will be left after tax and costs
- Estimating tax before committing to an investment property sale
Tips
- Hold for more than twelve months from contract date to contract date to halve the taxable gain. It is the largest single saving available.
- Every legitimate cost added to the cost base reduces the gain: stamp duty, conveyancing, inspections, agent commission, marketing and capital improvements.
- Keep records for the entire holding period. Without evidence of costs you cannot claim them, and property is often held for decades.
- Capital losses can only offset capital gains, never salary. But they carry forward indefinitely until used.
- Apply losses before the discount. Applying them afterwards wastes half their value, and it is a common error.
- Consider realising a gain in a year of lower income. Between jobs, on parental leave or newly retired can move the gain into much lower brackets.
What it assumes, and where it stops being accurate
- The seller is an individual Australian resident. Companies pay 30% with no discount; trusts and SMSFs are treated differently again.
- The asset is not your main residence. The main residence exemption is not modelled.
- The discount is applied at 50% for holdings over twelve months, ignoring any partial-year apportionment for periods of foreign residency.
- Depreciation and capital works deductions previously claimed on a rental property reduce the cost base in reality but are not modelled here.
- Small business CGT concessions, rollovers and scrip-for-scrip relief are outside scope.
- The Medicare levy is included in the marginal calculation, but the Medicare levy surcharge is not.
Terms used on this page
- Cost base
- The total cost of acquiring and improving an asset, used to work out the gain on sale.
- CGT discount
- The 50% reduction in the taxable gain available to individuals holding an asset more than twelve months.
- Capital loss
- A loss on disposal, which can offset capital gains but not other income, and carries forward indefinitely.
- Main residence exemption
- The rule that removes capital gains tax from the home you live in.
- Capital improvement
- Structural work that adds value, as distinct from repairs, which are deductible against income instead.
Questions people ask
- How is capital gains tax calculated in Australia?
- There is no separate CGT rate. The net gain is added to your taxable income for the year and taxed at your marginal rates. If you held the asset for more than twelve months as an individual, only half the gain is added. So someone on the 37% marginal rate effectively pays about 18.5% on a discounted gain.
- What is the 50% CGT discount and who gets it?
- Individuals and trusts get a 50% discount on capital gains from assets held more than twelve months; complying super funds get one third. Companies get no discount at all. The twelve months runs from contract date to contract date, so selling at eleven months and three weeks means the full gain is taxed.
- Do I pay CGT on my own home?
- Generally no. The main residence exemption removes CGT from the home you live in. It becomes partial if you rent out part of the property, run a business from a dedicated area, or move out and rent it. The six-year rule can preserve the exemption for up to six years after moving out, provided you do not nominate another property as your main residence for that period.
- Can capital losses offset my salary?
- No. Capital losses can only be applied against capital gains, not against salary or other income. Unused losses carry forward indefinitely until a gain arises, which is why keeping records of losses matters even in years when they seem useless. Apply them before the discount to get their full value.
- When do I pay the capital gains tax?
- It is assessed in the financial year the contract is signed, not when settlement occurs, and it is paid when you lodge the return for that year. A contract signed on 29 June falls into that financial year even if settlement is in August. A detail that can shift the liability by a full year and change which income year the gain stacks on.
- Does stamp duty reduce my capital gain?
- Yes. Stamp duty paid on purchase forms part of the cost base, along with conveyancing, building and pest inspections, and buyer's agent fees. So does agent commission on sale. These are the deductions people most often forget, and on a property purchase they can easily total forty or fifty thousand dollars.
Use this with
Capital Gains Tax Calculator answers one part of the question. These pick up where it stops: Negative Gearing Calculator, Property Rental Yield Calculator, Australian Income Tax Calculator and Crypto Tax Calculator (Australia).
Where these figures come from
Figures and rules on this page follow Australian law and ATO guidance.
- ATO: Tax rates for Australian residents. Income tax brackets for 2026-27
- ATO: Study and training loan repayment thresholds and rates. HELP repayment thresholds and the marginal repayment system
- ATO: Medicare levy surcharge income thresholds and rates. Surcharge tiers for singles and families
- ATO: Super guarantee and contribution caps. SG rate 12% and the maximum contribution base
Capital Gains Tax Calculator produces an estimate for general information. It is not financial, tax, medical, legal or engineering advice. read the full disclaimer. Spotted a wrong number? Report it and it gets fixed. The form picks up this calculator and the inputs you used.