Post-budget, the focus shifts from easy tax minimisation to actual wealth generation. Photo: Anchiy.
If recent changes to capital gains tax, negative gearing and discretionary trusts do their job, a real estate portfolio and a family trust won’t be the wealth-building vehicles they used to be.
So where are finance-savvy Australians putting their money instead?
Superannuation remains one of the most tax-effective structures available for long-term retirement savings and experts are predicting a major wave of capital shifting away from traditional assets and into the retirement system.
“I think there’s going to be greater emphasis placed on superannuation rather than just simply going out and buying an investment property,” Access Wealth Group principal financial adviser Brendan Doherty says. “That’s certainly the conversation we’re having with clients post-budget.”
The 2026 Federal Budget dramatically reduced the appeal of established property investing by replacing the lucrative 50 per cent capital gains tax (CGT) discount with inflation indexation and a 30 per cent minimum tax rate.
Negative gearing has also been restricted for established homes, meaning investors can no longer offset annual rental losses against their salaries to lower their immediate income tax bills.
By confining these traditional tax perks strictly to new builds, the rules force established property investors to absorb ongoing costs out of pocket, shifting the focus from easy tax minimisation to actual wealth generation.
“That means a lot of the tax benefits that you once had when purchasing an established property in your own name are gone,” Brendan says. “A lot of our clients are veering away from the traditional model of investing that relied on marginal tax rates and concentrating on boosting their super in the coming years.”
Property tax perks aren’t the only casualty. Discretionary family trusts – a favourite wealth-management tool for decades – are also facing a major shake-up.
Access Wealth Group principal financial adviser Brendan Doherty says clients are veering away from the traditional model of investing that relied on marginal tax rates. Photo: Michelle Kroll.
Starting 1 July 2028, the government will enforce a 30 per cent minimum tax rate on these trusts. This effectively closes the loophole of lowering tax bills by splitting income with low-earning family members.
With these updates, superannuation is looking like a stronger tax-saving prospect than ever.
Money contributed to super before tax, or earned from your fund’s investments, is taxed at a flat rate of 15 per cent. That compares to the personal marginal tax rates paid on your salary, which quickly climb from 16 per cent to 45 per cent (plus the Medicare levy), depending on how much you earn.
“I can’t think of a mechanism that’s more tax-effective,” Brendan says.
Many of Brendan’s clients are now looking to optimise their super contributions and there are a few mechanisms to exploit.
From 1 July 2026, the annual concessional (before-tax) contribution cap will rise from $30,000 to $32,500, allowing Australians to squirrel away an extra $2500 per year into the low-tax super environment, for example, through salary sacrificing.
In addition, those with super balances below $500,000 can go a step further by carrying forward unused caps from the previous five financial years.
But while your super fund is an excellent place for discretionary income and lump-sum contributions, Brendan points out that timing is everything. Once your money is tied up in the super environment, there aren’t many ways to touch it before reaching your preservation age (usually 60).
“That’s why a lot of people increase their contributions in the lead-up to retirement, but not so much for younger people who might have to wait 20 years to access it,” he says.
Yet whether you are fast approaching retirement or just starting your career, navigating these shifting goalposts requires a proactive approach.
The advice is simple: review your superannuation frequently to ensure your investment mix is appropriate and if in any doubt, seek professional guidance.
“Superannuation rules are complex, so it’s a good idea to see an adviser to confirm the thresholds that apply to you and which strategies are best utilised to boost your super and improve your retirement outcome,” Brendan says.
For more information, visit Access Wealth Group.
