Treasury Laws Amendment (Tax Reform No. 1) Act 2026 (49 of 2026)

Schedule 1   CGT adjustments

Part 1   Main amendments

Income Tax Assessment Act 1997

48   After subsection 960-275(1A)

Insert:

(1B) For indexation under subsection 110-36(1A) of the *cost base of a *CGT asset (except the first element of the cost base of an asset covered by subsection (3)), the indexation factor for expenditure:

(a) in an element of the cost base; and

(b) incurred on or after 1 July 2027;

is:

The expenditure can include giving property: see section 103-5.

Note 1: This includes expenditure taken to have been incurred on 1 July 2027 as mentioned in paragraph 112-155(2)(b), 112-165(2)(b) or 112-175(2)(b).

Note 2: There are rules affecting when the expenditure was incurred: see Division 114.

(1C) For indexation under subsection 110-36(1A) of the first element of the *cost base of a *CGT asset that is a *share in a company, or unit in a unit trust, the indexation factor for an amount in that first element that was paid to the company or trust at a time:

(a) after the asset was *acquired; and

(b) on or after 1 July 2027;

is:

The payment can include giving property: see section 103-5.

Example: Peter acquires shares in a company. The shares are partly-paid, and the company makes a call on the shares. Peter sells the shares to Narina before Peter is liable to pay the call.

The amount Narina paid to Peter for the shares is indexed under subsection 960-275(1B) from the quarter in which she incurred the expenditure to acquire the shares.

The amount Narina later pays for the call on the shares is indexed in accordance with this subsection from the quarter in which she made that later payment.