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Government concession cards, including the Commonwealth Seniors Health Card, Pensioner Concession Card, Health Care Card and state-based Seniors Cards provide significant savings. These cards help you reduce costs on healthcare, prescriptions, and daily expenses, making life more affordable.

Federal Government concession cards

These cards offer lower prescription costs of $7.70 compared to the general rate of $31.60. Also, once you reach the Pharmaceutical Benefit Scheme (PBS) Safety Net of $277.20 annually, your PBS medications are free.

The Commonwealth Seniors Health Card (CSHC) is for self-funded retirees aged 67 or older not receiving a Centrelink pension. Your income must be below $99,025 (singles) or $158,440 (couples) indexed annually. With no asset test, it’s ideal for retirees with retirement savings.

The Pensioner Concession Card (PCC) is automatically issued to those on the Age Pension, Disability Support Pension, or Carer Payment. It lasts two years, and is renewed around your birthday. If your social security pension stops permanently due to high income or assets, you must stop using it.

The Health Care Card (HCC), including the Low-Income Health Care Card, is for those on Centrelink payments like JobSeeker, or meeting low-income criteria. Many doctors bulk bill HCC and PCC holders, further cutting healthcare costs.

Extra benefits of your federal concession cards

Many states offer concession card holders discounts on utilities such as water, electricity and gas. To find out what concessions are available to you, check out the link to your relevant State Government (see table below).

State-based seniors cards

Alongside federal concession cards, state-based Seniors Cards offer additional discounts. These cards unlock savings on public transport, dining, entertainment and local services, helping you enjoy a more affordable and active lifestyle. From discounted public transport fares with Victoria’s Seniors myki, Queensland’s go card or NSW’s Gold Opal card to special offers at participating businesses, Seniors Cards make everyday experiences more accessible.

Who is eligible

State-based seniors’ cards are generally available for residents over 60 who are no longer working full time. For example, in New South Wales, those 60 or older working 20 hours or less weekly qualify for a Seniors Card, while those working more hours can apply for a Senior Savers Card.

The Victorian Seniors Card is available for Victorians aged 60 or older, working less than 35 hours per week.

In Queensland, you qualify for a Seniors Card or Seniors Card+go if you’re 65 or older and work less than 35 hours per week (averaged over 12 months), or if you’re 60–64, work under 35 hours weekly and hold a PCC, HCC, or eligible Department of Veteran Affairs card. A Queensland Seniors Business Discount Card is available for those aged 60 or older.

Take advantage of your concession cards

Federal and state-based concession cards help you save where it matters most. Whether it’s lower-cost medications, bulk-billed doctor visits, discounted transport or savings on local services, these cards support your lifestyle and budget. Speak to us about applying for a concession card if you think you may be eligible.

State Webpage Links

• New South Wales: https://www.service.nsw.gov.au/campaign/savings-finder

• Victoria: https://services.dffh.vic.gov.au/concessions-and-benefits

• Queensland: https://www.concessionsfinder.services.qld.gov.au/

• Western Australia: https://concessions.communities.wa.gov.au/

• South Australia: https://www.sa.gov.au/topics/care-and-support/concessions/concession-finder

• Tasmania: https://www.concessions.tas.gov.au/

With Trump’s tariffs causing big sell downs on share markets around the world, it is important to understand a few key things about how capital gains (and capital losses) from the sale of shares are treated for CGT purposes in Australia.

For a start, it is crucial to know what the cost – or specifically the “cost base” – of the shares are in order to calculate the assessable capital gain (or loss). This cost base will include relevant brokerage fees.

And for shares received under a dividend reinvestment scheme (DRIP), the cost base will be the value of the dividend which has been applied to buy shares in the company.

Importantly, where only some of the shares in a parcel of shares are sold it will be necessary to identify exactly which of those shares have been sold – in circumstances where you may have acquired the shares at different times for different costs. In this regard, usually some form of “identifier” (ASX or company etc) is attached to the shares.

But where it is not, the ATO allows you to choose which parcel of shares have been sold – provided you keep records of this so that there is no doubling-up or reselling of the same parcel of the same shares again later on down the track. And of course, this may allow you to choose which shares you sell in a tax-effective manner.

Of course, the CGT discount is available to reduce the amount of your assessable capital by 50% if you have owned the shares for 12 months – or 365 days to be precise. And in an interesting bit of nitpicking, the ATO takes the view that this does not include the day on which you bought the shares and the day on which you sold them!

Another important thing to understand is how exactly you calculate your “net” capital gain for the income year that is to be included in your assessable income.

And the key thing to note here is that any capital losses of the taxpayer from either the immediate year or prior years must first be applied to any capital gain/s of the taxpayer before applying the 50% CGT discount – and this will mean that there is a bigger net capital gain (if any) to be assessed (as opposed to if the discount was applied first).

However, where there is more than one capital gain from a particular source, the taxpayer can choose which capital gain it will apply the capital loss against first. And, usually, the best result in this case is to apply the capital loss to a gain that is not eligible for the CGT discount.

But where there are a number of capital gains and losses to be netted this process can get complicated – and our advice will be invaluable in this case.

Finally, beware of engaging in “wash sales” in the current volatile market – and this broadly occurs where you sell the shares to, say, realise a capital loss and then buy them back soon after in order to obtain some tax advantage. This ATO treats wash sales as tax avoidance.

So, if you are selling shares, see us first so we can help you do so in the most tax-effective method relative to all your circumstances.

An important reminder: Interest incurred in income years starting on or after 1 July will no longer be deductible, regardless of whether the debt relates to an earlier income year.

However, interest charged by the ATO that was incurred before 1 July 2025 can still be claimed as a deduction this tax time.

Therefore, if you have overdue tax debts please arrange an appointment with us so we can discuss what options you have to pay these debts in the most expedient manner. This could include various payment plans arranged with the ATO. And while general interest charge (GIC) will still accrue, paying off the debt will decrease the amount of interest charged.

Therefore, it is more important than ever for you to keep on top of ATO obligations to avoid unnecessary costs. This can also include trying to make it easier to have funds available when it’s next time to pay. For example, we can discuss setting aside GST, pay as you go withholding and super from your business’s cash flow.

Starting 1 July 2025, Age Pension means test thresholds will increase, potentially boosting eligibility and payments for retirees. These changes, announced by the Department of Social Services, aim to keep pace with inflation and living costs. Here’s a quick overview of how these changes may impact you.

What are the Age Pension means tests?

The Age Pension, available to residents aged 67, uses income and assets tests to determine eligibility and payment amounts. The test that results in the lower pension payment applies. If your income or assets exceed certain thresholds, you may not qualify for a pension or only receive a part pension. From 1 July 2025, these thresholds are rising, meaning more people may qualify for a full or part pension, and current part-pensioners could see higher payments.

Income test changes

The income test assesses earnings from sources like wages, interest, dividends and rental income. Centrelink uses deeming rates (currently 0.25% for the first $62,600 for singles or $103,800 for couples, and 2.25% above these) to estimate income from financial assets like bank accounts, managed funds and shares. The deeming rate from 1 July 2025 had not been confirmed at the time of writing.

From 1 July, singles can now earn $218 per fortnight ($5,668 yearly) for a full pension, and up to $2,516 ($65,416 yearly) for a part pension.

Each dollar above the lower threshold reduces pension entitlements by 50 cents for singles and by 25 cents per partner for couples.

This does not consider the Work Bonus which lets pensioners earn up to $300 per fortnight from work without affecting their pension.

Table 1: Fortnightly income test thresholds

*rounded down to nearest dollar

Assets test changes

The assets test evaluates your assets such as shares, bank accounts, investment properties, etc. However, it excludes your family home. The new thresholds from 1 July 2025 are illustrated in the table below.

From 1 July a single homeowner may receive the full age pension if their assets are below $321,500 and a part-pension if their assets are below $704,500. A couple who are homeowners may have up to $481,500 in assets (combined) to receive the full age pension and may receive a part-pension if their assets are below $1,059,000. Non-homeowners can have more assets before their pension is reduced.

What this means for you

The changes to the Age Pension means test thresholds could significantly impact your retirement income, depending on your financial situation. The increased income and asset thresholds mean more retirees may qualify for the Age Pension or receive a higher part pension.

Remember that your Age Pension entitlement is determined by the lower of the income and asset test. If either test results in zero, you’re ineligible.

If you would like to learn more about your Age Pension entitlements give us a call.

Table 2: Asset test thresholds

If you’ve been keeping an eye on your super, you might be wondering whether the contribution limits are increasing this year. The answer is – not yet.

Two key caps that determine how much you can put into super each year will stay the same from 1 July 2025.

Concessional contributions
These are contributions made before tax – like employer contributions, salary sacrifice, or personal contributions that you claim as a tax deduction. They’re taxed at 15 % when they go into your super fund (unless you’re a high-income earner, in which case extra tax may apply).

And here’s a bonus – if you haven’t used your full concessional caps in recent years and your total super balance is under $500,000 as at 30 June 2025, you may be able to use the catch-up (carry-forward) rule to contribute more.

Non-concessional contributions
These are contributions made from your after-tax money. You don’t get a tax deduction for these contributions, but they’re a great way to boost your super savings over time.

Plus, if you’re under 75, you might be able to use the bring-forward rule to contribute up to $360,000 in one go by using three years’ worth of caps. Just remember – eligibility rules apply, like your total super balance and whether you’ve used this rule before.

For now, these caps are staying at $30,000 for concessional contributions and $120,000 for non-concessional contributions per financial year. If you were hoping to contribute even more, you’ll need to wait for a future increase.

So what is changing?

The transfer balance cap
Starting 1 July 2025, the limit on how much super you can move into a tax-free retirement pension account will go up from $1.9 million to $2 million. This limit is called the transfer balance cap. This change means you can transfer more of your super into a tax-free pension when you retire.

The money you withdraw from your super pension (also called an account-based pension) is not taxed if you are 60 or over and the pension’s investment earnings are not taxed either. This can make a big difference to your savings in retirement.

If you haven’t started a pension before, the new cap of $2 million applies to you in full. However, if you’ve already started one, your personal cap may be somewhere between $1.6 million and $2 million, depending on your past pension history.

In the end, this increase is great news for anyone thinking about retirement, giving you more room to grow your super in a tax-free environment.

If you haven’t used your full concessional caps in recent years and your total super balance is under $500,000 as at 30 June 2025, you may be able to use the catch-up (carry-forward) rule to contribute more.

Why does this matter?

Even though the contribution caps aren’t going up, the increase to the transfer balance cap is a good reminder to check in on your super strategy, especially if retirement is on the horizon.

If you’re still working, now’s a great time to make sure you’re making the most of the current concessional and non-concessional contribution limits to build your super while you can.

And if you’re approaching retirement, consider how the higher transfer balance cap could open up more tax-free opportunities for your pension savings. It might be worth thinking about whether you should contribute more to your super now to make the most of it later.

Need help?

Super can be complex, but you don’t have to work it all out on your own. If you’d like help understanding these changes or planning your next steps, get in touch with us. We’re here to help.

From 1 July 2025, your superannuation guarantee (SG) rate is increasing to 12%. That means more money going into your super from your employer, helping you build a better nest egg for retirement.

But what happens if you earn some of your wages before 30 June but get paid after 1 July? Will the higher super rate apply to that pay too? Let’s break it down.

It’s all about when you get paid

The key rule here is that the SG rate is based on when you’re paid, not when you earned the money.

So even if you did the work in June, if your pay day is on or after 1 July 2025, your employer has to pay 12% super on those wages.

If you get paid before 1 July 2025, then the old rate of 11.5% applies – if the work was done in July. It all comes down to the date the money hits your bank account.

A quick example

Let’s say George works for XYZ Pty Ltd:

• If George works in June (or even across June and July), but gets paid in July, his employer must pay 12% super on the whole amount.
• If George works in July, but for some reason gets paid in advance in June, only 11.5% super applies.

Your employer will then need to send that super contribution to your fund by the usual deadlines – generally within 28 days after the end of the quarter.

The final step in a long journey

The increase in the SG rate to 12% is the last step in a plan that’s been rolling out over the past few years. Here’s how the SG rate has been increasing:

This is great news for workers, because more super means more savings for retirement, and that can make a big difference later on.

What counts for super?

Super is generally paid on what’s called your ordinary time earnings (OTE). That’s the amount you’re paid for your regular working hours, plus things like commissions, allowances, and shift loadings.

Super usually isn’t paid on things like overtime, reimbursements, and some other specific payments.

Need help?

If you’re unsure whether your super is being calculated correctly, don’t hesitate to ask for help. Your super is your money for the future, so it’s worth making sure you’re getting everything you’re entitled to.

For employers, if you’re uncertain about how the new super rate applies to your team, or need clarity on which payments count for super, don’t leave it to chance.

Getting it right helps you avoid costly mistakes and penalties. We’re here to help both employees and employers understand their super obligations and entitlements, so you can have confidence that everything’s on track.

A recent Administrative Review Tribunal (ART) decision on working from home costs during the 2020–21 COVID lockdowns (Hall’s case) may widen the scope for claiming additional deductions for occupancy costs such as rent, mortgage interest, home insurances and rates, but only in specific circumstances. This is on top of the hourly rate most people claim to cover additional energy, phone and internet costs.

Like many others, Mr Hall was forced to work from home in order to do his work, which involved the production of an online radio sports program for the ABC in Melbourne. The combination of government-imposed restrictions and the ABC’s own rules meant that during the height of the COVID lockdowns in 2020–21, the spare bedroom in a rented apartment which he used exclusively or nearly exclusively to carry out his role for the ABC was his only place of business.

Importantly, Mr Hall was not running a business from his home. He was an employee working remotely, as over a third of Australian employees still do to some extent these days. While Tribunal decisions are not legally binding, and Hall’s case only applies to the 2020–21 income year at the height of the COVID lockdowns, the decision seems well-reasoned and could arguably be applied more broadly.

While the lockdowns are thankfully well behind us now, the principle governing the Tribunal’s decision is that a proportion of a taxpayer’s rent (or mortgage interest) may be deductible where the employer does not provide a work space and the taxpayer has no alternative but to work from home. This can and does happen even today, well after the masks have been put away.

Who might qualify?

An important factor in the Hall case was that there was no element of choice involved. No workplace was legally available to Mr Hall at the ABC Studios and he had no alternative but to use his spare bedroom to produce his radio sports program. Where an employee works under flexible arrangements by choice (e.g. three days from home; two days in the office), the reasoning in Hall’s case is not so easily applied since it would be open to the employee to attend the office every day. You could still make a claim, but it could be difficult to sustain.

On the other hand, where there is no longer an office to attend because the employer has chosen to cut back on rental costs, the only option for the employee is to work from home. In other situations employees might interact exclusively online with externals and other parts of the business because they don’t live in the same State as their employer’s office. Again, such an employee has no place to work from other than their home.

To be eligible for a proportional deduction for occupancy costs, the employee would need to work out of a designated area such as a spare room and use that area exclusively or nearly exclusively as their home office. Just setting up the laptop on the dining-room table when the dining room is regularly used for other purposes isn’t enough.

Capital gains tax

Employees who might qualify for a proportional deduction for occupancy costs that includes mortgage interest will need to consider the potential impact on the capital gains tax (CGT) exemption on their main residence before deciding to pursue a claim. The main-residence CGT exemption is reduced by the same proportion as the claim for occupancy costs, and a valuation is required at the time the home is first used partly for income-producing purposes.

So a home owner without a mortgage or with only a small mortgage may decide that claiming a proportion of occupancy costs isn’t worth compromising their main residence CGT exemption. We can help you weigh up the options. An employee who rents, as Mr Hall did, would have no such concerns.

To be eligible for a proportional deduction for occupancy costs, the employee would need to work out of a designated area such as a spare room and use that area exclusively or nearly exclusively as their home office.

The Commissioner is unlikely to allow occupancy claims

In the meantime, the Commissioner has appealed to the Federal Court and issued a Decision Impact Statement explaining that he disagrees with the Tribunal’s decision. He will continue to apply his longstanding restrictive approach to both occupancy costs and travel claims, pending the outcome of his appeal. That should not deter you from making a claim, however.

In order to avoid the risk of penalties and interest, the best course would be to just claim the normal hourly rate (or actual cost method) to cover additional running costs when lodging your return. Then, after the notice of assessment has been received, lodge an objection claiming the occupancy costs. That way your rights are protected and you are not exposed to penalties or interest.

There may also be scope to revisit earlier assessments if you were locked down for a period and worked from home using a designated area exclusively or nearly exclusively for that purpose. In the case of earlier assessments it may be necessary to ask the Commissioner for extra time in which to lodge an objection.

We’re here to help you!

We should have a discussion about this issue if:

• Your employer requires you to regularly work from home
• No office space is available for you in which to perform your duties
• You work from home using a designated space such as a spare room which is used exclusively or nearly exclusively for that purpose
• You rent your home or if you are a home owner and you have a substantial mortgage

With the end of the financial year coming up, now’s a great time to get on top of your tax and super. A little planning before 30 June can help you make the most of any opportunities to reduce tax, boost your super, and avoid last-minute surprises.

This checklist outlines key things to consider and action before the financial year wraps up. It’s a simple way to stay on track and finish the year with confidence.

Tax Checklist

Here are some practical things to consider before 30 June to help you tidy up your tax position and potentially reduce your bill.

✅ Bad Debts

If you’re running a business, write off any bad debts that won’t be recovered before 30 June so they can be claimed.

✅ Employee Bonuses and Director Fees

Planning to pay employee bonuses or director fees? Make sure they’re confirmed in writing and communicated to recipients by 30 June, even if payment happens later.

✅ Charitable Donations

Bring forward any planned donations and have the highest-earning family member make the gift. Remember:

• Donations must be to registered charities.
• They can’t create a tax loss.
• Keep receipts.

✅ Prepay Interest on Loans

If you have a loan for an income-generating asset (like an investment property), consider prepaying interest before 30 June to bring forward the deduction.

✅ Claim Work-Related or Business Costs

Bring forward costs such as repairs, stationery, or supplies by 30 June 2025. These small deductions can add up. This applies to all taxpayers, not just businesses.

✅ Prepay Expenses

You can claim prepaid expenses, such as insurance or subscriptions. Where the expense is:

• Under $1,000 – all taxpayers can claim the expense
• Over $1,000 – fully deductible if you’re a small business if the expense relates to a period of 12 months or less. This also applies to non-business expenses of individuals, such as work-related expenses or rental property costs.

✅ Write Off Old Stock

If you hold stock, write off any damaged, outdated or unsellable items before 30 June 2025.

✅ Review Assets & Depreciation

Small businesses (turnover under $10m) can immediately deduct assets under $20,000 that were acquired from 1 July 2024 and ready to use by 30 June 2025.

Also, remove any old equipment from your depreciation schedule if it’s been sold, thrown out, or is no longer usable.

✅ Electric Vehicles

If your business provides an electric vehicle to an employee, you may be eligible for depreciation deductions and Fringe Benefits Tax (FBT) concessions.

✅ Defer Income

If possible, delay receiving income (like issuing invoices) until after 30 June to push tax into next year.

✅ Offset Capital Gains

Selling an asset this year with a profit? You could crystallise capital losses before 30 June to offset that gain.

🚫 ‘Wash sales’ (selling and rebuying the same asset just to get a loss) are not allowed.

✅ Defer Capital Gains

If you’re planning to sell an asset for a gain, consider delaying until after 30 June if it makes sense for your broader financial situation.

✅ Personal Services Income (PSI)

If you’re working in your own name (like a contractor or freelancer), check that your income qualifies as a business under PSI rules.

✅ Business Losses

If your business runs at a loss, you may not be able to claim that loss if you carry on a “non-commercial business” – unless you pass one of the ATO’s tests (eg, income, asset, or profit test).

✅ Company Loans to Shareholders (Division 7A)

If you’ve borrowed from your company, the loan needs to be properly documented, put on commercial terms and repaid.

If repaying through dividends, make sure the dividends are legally declared and paid prior to 1 July (with appropriate documentation in place).

✅ Trust Distributions

If you’re a trustee, resolutions must be made before 30 June to properly distribute income to beneficiaries. You also need to let your beneficiaries know what they’re entitled to.

✅ Beneficiary TFN Reporting

If new beneficiaries gave you their TFN between April–June, you must lodge a TFN report by 31 July 2025.

✅ Motor Vehicle Logbook

Planning to claim car expenses using the logbook method?
Start now and track 12 weeks of usage (can span over two tax years). Also record your odometer readings.

✅ Private Health Insurance

Make sure you have the right level of cover to avoid the Medicare Levy Surcharge, especially if your family situation has changed (eg. new baby, separation, adult children moving off your policy).

✅ Check Your Insurance Cover

Review your personal and business insurance needs. Not only does this provide peace of mind, some policies may also be tax deductible, especially if prepaid.

✅ Review Your Business Structure

Is your current setup still the right one? Changes in income, family, or risk levels may mean a trust, company, or restructure could be more effective. We can help you weigh up your options.

Super Checklist

Make the most of your super before 30 June 2025 with these smart, simple tips.

✅ Check Your Contribution Limits

Before adding more to super, log in to myGov > ATO > Super > Information to check how much you’ve already contributed.

⚠️ If you’re in an SMSF, your info may not be up to date in myGov, but we can help you work this out.

✅ Add to Super and Claim a Tax Deduction

You may be able to make a personal deductible contribution and claim it at tax time.

To be eligible:

• You must be over 18
• If you’re 67–74, you must meet the work test or qualify for a work test exemption
• If you’re over 75, you must contribute within 28 days of your birthday month

⚠️ To claim a tax deduction, submit a Notice of Intent to Claim a Deduction to your super fund and get their confirmation before lodging your tax return or making withdrawals, rollovers, or starting a pension.

✅ Use Up Unused Contribution Limits

Haven’t used your full concessional contribution cap in recent years? You may be able to catch up using the carry-forward rule if your total super balance is under $500,000 on 30 June 2024.

⚠️ Unused limits from 2019–20 expire after 30 June 2025 so don’t miss out.

✅ Split Contributions with Your Spouse

You can split up to 85% of your 2023–24 concessional (pre-tax) contributions with your spouse before 1 July 2025.

This is a great way to even out your balances and plan ahead for retirement.

⚠️ To use this strategy, your spouse must be under their preservation age or aged 64 or younger and not retired when you make the request to your fund.

✅ Get a Tax Offset for Spouse Contributions

If your spouse earns less than $40,000, consider making an after-tax contribution to their super.

By doing so, you could get up to a $540 tax offset while boosting their retirement savings.

✅ Grab a Government Co-Contribution

If you earn less than $60,400 and at least 10% comes from work or running a business, you could be eligible for a government co-contribution.

All you need to do is add up to $1,000 to your super and the government may add up to $500 extra.

✅ Avoid the Division 293 Tax Trap

If your income (plus employer contributions) is over $250,000, you may pay an extra 15% tax on some of your super contributions.

Strategies like bringing forward expenses or deferring income may help keep you below the threshold.

✅ Maximise Non-Concessional (After-Tax) Contributions

If you’re under 75, you may be able to contribute up to $360,000 in one year using the bring-forward rule.

New rules from 1 July 2025 may allow you to contribute even more – speak with us about getting the timing right.

✅ Take Your Minimum Pension Payment

If you’re drawing a pension from your super, make sure you take the minimum amount by 30 June.

Missing the minimum may affect your fund’s tax benefits for the whole year.

Need help? We’re here to help you make the most of EOFY tax and super opportunities. Contact us to discuss what options might work best for your situation.

The rules surrounding the circumstances in which a home will be fully exempt from capital gains tax (CGT) are quite extensive – and complex.

One crucial one is that the exemption is only available for a home and “adjacent land to the extent that the land was used primarily for private or domestic purposes in association with the dwelling.”

There are some key things to know about this adjacent land requirement.

Firstly, it only applies where the adjacent land is no greater than two hectares – but excluding the land immediately under the home. And two hectares is roughly the old five acre block – and it is pretty big, being 20,000 square metres ie, 200 metres by 100 metres. (Step it out around your neighbourhood and you will see how big.)

Of course, there would be few homes in major metropolitan cities that would approach this block size – albeit it may be an issue for homes on the rural outskirts of such cities.

In the case where adjacent land exceeds two hectares, a full CGT exemption on the sale of the home is not available and some sort of partial capital gain arises on a pro-rata or valuation method. And the ATO is quite generous on how this can be calculated.

Secondly, the adjacent land must be “used primarily for private or domestic purposes in association with the dwelling.” This would include where a granny flat is erected on the adjacent land and a child, a relative or other person lives in it rent-free (or only pays outgoings – and not arm’s length or commercial rent).

Likewise, it would include where adjacent land has other structures on the land such as a large shed, a pool and cabana, a tennis court – provided again that the land and these structures on it are “used primarily for private or domestic purposes in association with the dwelling”.

But what constitutes “primarily for private or domestic purposes…”?

The ATO has a ruling on this issue which broadly provides that “primarily” requires a judgment as to time (and/or area) of land that the land was so used.

So, if for example a home that was owned for 30 years originally had a shed on a small part of it in which the owner carried on a small “shed” activity for a year, it should be possible to conclude that the land was used “primarily” for private or domestic purposes.

But otherwise, only a partial CGT main residence exemption is available to the extent that the adjacent land was not so “used primarily for private or domestic purposes in association with the dwelling”.

Thirdly, the adjacent land need not be immediately surrounding the home. It could for example, include vacant land on a separate title across the road or next door (or such land that has a dwelling or other building on it) – as long as it is “used primarily for private or domestic purposes in association with the dwelling.”

However, the further the distance between the relevant land and the land on which your home is situated the less likely it is that the relevant land is “adjacent” land.

Finally, and importantly, if you sell (or gift or transfer) any part of adjacent land separately from the whole of your home and adjacent land (eg, on its subdivision) then no CGT main residence exemption is available for any capital gain or loss you make on this transaction. And this is because the exemption applies to the home in totality – which includes all of the adjacent land.

This issue also arises in relation to dual occupancy arrangement where the new dual occupancy dwelling may be sold separately from the original home. However, the ATO has detailed guidelines on how the CGT rules apply in these circumstances.

If any of these scenarios apply to you come and get some advice from us – if only for peace of mind’s sake.

The proposed Division 296 tax, which is proposed to start on 1 July 2025, introduces an extra 15% tax on superannuation earnings above a $3 million super threshold. Everyone supports a fair and sustainable superannuation system, but the new tax is unpopular for many reasons.

Two big reasons people don’t like the new tax is that the:

• Tax will apply on asset growth even if the asset hasn’t been sold
• $3 million dollar threshold will not be adjusted with inflation

Let’s look at how the tax will apply on asset growth.

The new 15% tax will apply on your super fund ‘earnings’ on the proportion of your super balance that exceeds $3 million. You might think that earnings are simply the profits you have made or locked in but that is not the case when it comes to this tax. Instead, earnings are based on how much your super balance has increased over the year. This includes ‘paper gains’ or increases in the value of assets not yet sold.

This is a problem because your assets might be higher this year but may be lower when you sell them. In that case you have paid tax on ‘unrealised’ growth even though you didn’t make a profit. In fact you may subsequently sell the asset for a loss.

Another problem with taxing asset growth before the asset is sold is that you or your fund may not have the cash to pay the tax. In that case it is likely that you will be forced to sell an asset you were not planning to sell just to pay the new tax.

Only ‘earnings’ attributable to assets over $3 million are subject to the additional 15% tax. The threshold might sound high but with inflation the threshold in today’s dollar value will fall. A young person entering the workforce today can expect to pay Division 296 in the future unless this threshold is adjusted for inflation.

Keep in mind that this new tax has not yet been legislated and it may be premature to withdraw money from super to avoid the tax.

If you are concerned about how Division 296 tax may impact your retirement savings give us a call and we can help you understand its implications and explore strategies to optimise your superannuation.