In this crossover episode of The ifa Show, host Keith Ford is joined by The SMSF Adviser Show co-host Aaron Dunn to unpack the changes from the initial proposal to the current version released this week.
The discussion emphasises that while the major concerns of taxing unrealised gains and lack of indexation have been addressed, many technical details still need to be clarified through the legislative process and further consultation.
Listen as they discuss:
- Taxable earnings: Originally, the tax applied to all earnings, whether realised or not. The revised measure will only tax realised gains.
- Indexation: The $3 million threshold will be indexed against the consumer price index (CPI) in $150,000 increments, pegged to the transfer balance cap movement. The $10 million threshold will be indexed in $500,000 increments, also aligned with CPI.
- Tax rates: For balances above $3 million, an additional 15 per cent tax applies to earnings. For balances above $10 million, an additional 10 per cent tax applies to earnings.
- Start date: The effective start date has been moved to 1 July 2026, with the first assessments issued in FY2027–28.
- Liability: The tax liability remains with the individual, who can pay it directly or seek a release from their super fund. The ATO will calculate the tax.
- Consultation: There is optimism for constructive consultation on the implementation details, particularly regarding how realised earnings will be calculated for APRA funds and self-managed super funds, and the treatment of CGT discounts and pre-2026 asset gains.
