Free Capital Gains Tax Calculator Australia (2025–26)

In Australia, the capital gain on a property sale is added to the seller’s taxable income for the year of sale and taxed at the marginal rate. This calculator estimates the CGT liability, including the 50% CGT discount for assets held over 12 months, a cost base builder (purchase price, stamp duty, improvements), and a hold-vs-sell comparison showing how the holding period affects after-tax proceeds.

In Australia, the capital gain is added to your taxable income for the year of sale and taxed at your marginal rate (ATO — Capital gains tax overview). Australian resident individuals who held the property for more than 12 months can apply a 50% CGT discount, halving the taxable gain (ATO — CGT discount).

How does capital gains tax work for Australian property?

When you sell an investment property for more than it cost you to buy (and sell), the difference is a capital gain. In Australia, that gain is generally added to your taxable income for the year you sell, and the extra tax is worked out using your income tax brackets. The CGT system does not impose a separate flat tax rate — it flows through your regular income tax return, which means higher-income earners pay a higher effective CGT rate.

This calculator is designed for Australian resident individuals selling an investment property. It estimates your capital gain (sale price minus cost base), your taxable capital gain (after the 50% CGT discount if eligible), and the estimated extra tax payable due to the gain based on your other income. For a broader overview of how CGT applies to property, see our CGT guide for property investors.

Who is eligible for the 50% CGT discount?

The 50% CGT discount is available to Australian resident individuals and trusts (but not companies) who held the asset for at least 12 months before selling. The discount halves the capital gain before it is added to your taxable income . The following table summarises CGT discount eligibility by entity type.

Source: ATO — CGT discount, retrieved 9 Feb 2026.

What is included in the property cost base?

The cost base determines how much you can subtract from the sale price before calculating your capital gain. The ATO defines five elements of the cost base. This calculator builds your cost base from common property-related inputs.

Capital works deductions (Division 43) you were able to claim can reduce the relevant capital costs included in your cost base (subject to exceptions) (ATO — Cost base adjustments for capital works). This calculator includes a field for total Div 43 deductions claimed and subtracts them from the cost base as a simplified adjustment.

Source: ATO — Cost base of asset, retrieved 9 Feb 2026.

What assumptions and limitations does this calculator have?

• Estimates only for Australian resident individuals; company/trust/foreign resident rules are not modelled.
• Does not include the main residence exemption, the 6-year absence rule, or partial exemption calculations.
• Does not include capital losses from other assets, prior year losses, or other capital gains in the same year.
• Does not include Medicare levy surcharge, HELP/HECS-HELP repayments, offsets beyond what is in the income-tax module, or tax-agent-specific adjustments.
• Uses annual “other income” (excluding the capital gain) for the year you sell.

Worked example: Brisbane house, couple, 6-year hold

James (42) and Lisa (42) bought a 3-bedroom house in Brisbane’s Morningside in 2019 for $430,000. James earns $105,000 and Lisa earns $75,000. The property is held in James’s name only.

Purchase and ownership costs:

• Purchase price: $430,000
• Stamp duty: $12,500
• Legal fees (purchase): $2,000
• Building inspection: $500
• Renovation (new bathroom): $25,000
• Division 43 deductions claimed over 6 years: $7,500

Sale scenario (2025):

• Current market value: $620,000
• Agent commission (2.5%): $15,500
• Legal fees (sale): $1,500
• Other income in sale year (James): $105,000

Cost base calculation:

CGT calculation:

• Capital gain: $620,000 - $479,500 = $140,500
• 50% CGT discount (held 6 years): $140,500 / 2 = $70,250
• Taxable capital gain added to James’s income: $70,250
• James’s total taxable income in sale year: $105,000 + $70,250 = $175,250
• Estimated CGT on the gain: ~$24,338
• Effective CGT rate: ~17.3% of the total capital gain

James’s effective CGT rate of 17.3% is significantly lower than his 32% marginal rate (30% + 2% Medicare) because the 50% discount halves the gain before it enters his income tax calculation.

Had the property been in Lisa’s name (on $75,000 income), the estimated CGT would be ~$21,475 — approximately $2,863 less per year, because more of the gain falls into the 30% bracket rather than the 37% bracket. Ownership structure matters for CGT outcomes.

Enter your actual numbers in the calculator above to see the cost base breakdown and estimated CGT.

The Division 43 Cost Base Trap

Many investors are surprised to learn that Division 43 (capital works) deductions they claimed during ownership reduce the property’s cost base when they sell (ATO — Cost base adjustments for capital works). This increases the capital gain and therefore the CGT payable.

How it works: If you claimed $6,250 per year in Div 43 deductions for 10 years, that $62,500 in total deductions reduces your cost base by $62,500. On a property with a $200,000 capital gain, your gain becomes $262,500 instead.

Is it still worth claiming? Almost always, yes. The annual tax savings from depreciation are received each year, while the additional CGT is only payable when you sell. Using the numbers above:

• Tax savings from depreciation (10 years at 30% marginal rate): $62,500 x 30% = $18,750
• Additional CGT on sale (with 50% discount, 30% marginal rate): $62,500 x 50% x 30% = $9,375
• Net benefit: $9,375 — plus the time value of receiving tax savings annually rather than paying additional CGT years later

The net benefit is even greater at higher marginal rates. Check your Division 43 deductions using our depreciation calculator — and remember that Division 40 (plant and equipment) deductions do not reduce the cost base in the same way.

The 12-Month Milestone: When Timing Your Sale Can Save Thousands

The 50% CGT discount creates a dramatic difference in tax outcomes either side of the 12-month holding mark. Selling at 11 months versus 13 months can cost tens of thousands of dollars in additional tax.

Example: $200,000 capital gain, $100,000 other income

Waiting just 2 months saves approximately $38,400. If you are considering selling an investment property and you are close to the 12-month mark, it is almost always worth waiting. Even if the property value were to drop by 5% during those 2 months (a $31,000 decline on a $620,000 property), you would still be better off financially by waiting for the discount.

The “Compare Holding Periods” feature in the calculator above shows how this plays out at different exit points using your own numbers.

Should I Sell Now or Wait? (Hold vs Sell Comparison)

“Should I hold or sell?” is one of the most common and most stressful questions for property investors. Forum threads are full of investors who have been “putting in $1,000 every month” for years, unsure whether holding will eventually pay off or whether they should cut their losses.

The “Compare Holding Periods” section above projects your estimated after-tax proceeds if you sell in Year 1, Year 2, Year 3, and beyond, using an annual capital growth rate you set. For each year, it shows:

• Estimated sale price at that holding point
• Whether the 50% CGT discount applies (requires 12+ months)
• Estimated CGT payable at each exit point
• After-tax proceeds so you can compare outcomes side by side

Using James and Lisa’s scenario above: If James holds for 2 more years with 5% annual capital growth, the property could reach approximately $683,100. The capital gain rises to ~$203,600, but the after-tax profit increases from ~$116,162 to ~$156,800 — an extra $40,638 for 2 additional years of holding. Whether that is worthwhile depends on the annual holding cost during those 2 years. If holding costs $12,000 per year after tax, the net benefit of waiting is $40,638 - $24,000 = $16,638.

The hold-vs-sell decision depends on holding costs, expected capital growth, and your personal circumstances. The calculator helps you model the financial dimension — but it cannot account for personal factors like needing the capital for another purpose or changes in your tax situation. Still holding? Use our negative gearing calculator to see your current after-tax holding cost.

How to Avoid Capital Gains Tax on Property in Australia

CGT on an investment property cannot be entirely avoided, but several provisions in the tax law can reduce or defer the liability. These are based on current ATO rules and should be discussed with a registered tax agent for individual circumstances.

Main residence exemption. Your principal place of residence is fully exempt from CGT. If you have always lived in the property and never used it to produce income, no CGT applies when you sell (ATO — Capital gains tax overview).

6-year absence rule. If you move out of your main residence and rent it out, you can treat it as your main residence for up to 6 years (provided you do not nominate another property as your main residence during that period). This can fully exempt the capital gain if you sell within 6 years of moving out. If you move back in, the 6-year period resets. See our detailed CGT 6-year absence rule guide for conditions, examples, and common traps.

50% CGT discount. Australian resident individuals who hold an asset for more than 12 months receive a 50% discount on the capital gain (ATO — CGT discount). This is the most common CGT reduction strategy and applies automatically.

Include all legitimate cost base items. Stamp duty, legal fees, capital improvements, and selling costs all form part of the cost base under ATO rules. Keep records of all expenditure from the date of purchase.

Sale timing. The taxable gain is added to your other income for the year of sale and taxed at your marginal rate. Selling in a financial year when other income is lower results in a lower marginal rate on part or all of the gain.

Offset capital losses. If you have capital losses from other investments (such as shares), these can offset your property capital gain. Capital losses must be applied before the 50% discount is calculated.

Capital improvements. Capital improvements increase the cost base. The ATO distinguishes between capital improvements (which are added to the cost base) and repairs and maintenance (which are deducted as expenses but do not affect the cost base).

Capital Gains Tax Rate Australia 2025-26

There is no separate CGT rate in Australia. Capital gains are added to your taxable income and taxed using the ordinary resident income tax brackets for the year of sale (ATO — Tax rates for Australian residents). The calculator uses those current ATO brackets together with the Medicare levy settings to estimate the additional tax on your gain (ATO — What is the Medicare levy).

If you qualify for the 50% CGT discount, the taxable capital gain is reduced before those ordinary income tax rates apply (ATO — CGT discount). That usually makes the effective tax on the full gain materially lower than your headline marginal rate, but the exact result still depends on your other income and how much of the gain sits in each bracket.

Go Deeper with the Full Spreadsheet

Evaluating whether to hold or sell? Our premium spreadsheet models your CGT at different exit years alongside continued holding costs to find the optimal exit point. Compare up to 3 properties with 10-year projections that account for capital growth, rent increases, depreciation decline, and changing interest rates.

If you mainly need tax-time records, use the ATO rental property worksheet to track annual rental income, deductions, and depreciation before you model exit timing.

State-Specific CGT Calculators

CGT is a federal tax in Australia — the same rules apply regardless of which state your property is in. However, state-specific factors like stamp duty and land tax affect your overall property investment returns and cost base. We have created state-specific CGT calculator pages with worked examples and local context:

• Capital Gains Tax Calculator NSW — includes NSW stamp duty cost base information and Sydney property examples
• Capital Gains Tax Calculator QLD — includes QLD transfer duty cost base information and Brisbane property examples