Tax bracket optimisation calculator (Australian CGT)
Compare the total CGT payable on a planned disposal in FY 2025-26 versus FY 2026-27 based on your projected taxable income in each year. The calculator applies the 2025-26 marginal tax brackets, the 50 percent CGT discount where the holding period qualifies, and the 2 percent Medicare levy to compute the exact dollar difference between disposing now versus deferring to next financial year. Designed for AU-resident investors planning the timing of a significant CGT event.
Calculator
Disposal details
Projected taxable income
Why financial year timing matters
The Australian individual marginal tax brackets for 2025-26 (resident, single):
| Income range (AUD) | Marginal rate | Tax on bracket |
|---|---|---|
| 0 to 18,200 | 0% | Nil |
| 18,201 to 45,000 | 16% | Up to $4,288 |
| 45,001 to 135,000 | 30% | Up to $31,288 |
| 135,001 to 190,000 | 37% | Up to $51,638 |
| 190,001+ | 45% | +45% on excess |
A capital gain (after the 50% discount) is added to your assessable income. If the addition pushes you into a higher bracket, the gain is partially taxed at the higher rate. If you defer the disposal to a year with lower projected income, the gain may sit in a lower bracket.
When deferring saves money
- You expect lower income next year. Change of jobs, retirement, parental leave, planned sabbatical, or business income reduction.
- You're at a bracket cliff. Currently at the top of one bracket; the disposal would push you into the next bracket. Even a small income drop next year keeps you in the lower bracket.
- You can afford to wait. Cashflow doesn't need the disposal proceeds before EOFY.
- Price risk is acceptable. You believe the asset price will hold or rise during the deferral window. A 5% asset price drop can wipe out a 7pp tax bracket saving.
When deferring does NOT make sense: you expect HIGHER income next year (e.g., promotion, bonus, business windfall), or the asset is about to fall in price more than the tax saving justifies.
Methodology
- Taxable gain. Gross gain × (1 - 0.5 if long-term, else 1).
- Scenario A (dispose FY26). Tax on (FY26 income + taxable gain) - tax on FY26 income alone, using FY26 brackets.
- Scenario B (dispose FY27). Same formula using FY27 income and FY27 brackets (assumed unchanged from FY26 absent budget reform).
- Both scenarios include the 2 percent Medicare levy (applies above $27,222 threshold).
- Saving. Scenario A CGT minus Scenario B CGT. Positive = save by deferring; negative = save by disposing now.
Limitations
- Medicare levy surcharge not modelled. If your income is above $97,000 (single) or $194,000 (family) without private health insurance, you pay an additional 1-1.5%. Actual CGT will be higher than shown.
- HECS / HELP repayments not modelled. A large gain that lifts taxable income can trigger or increase HECS repayments. Material for those with student loans.
- Tax offsets ignored. Low-income tax offset (LITO), spouse offset, etc. The calculator computes tax on raw income; offsets typically REDUCE the cliff effect slightly.
- Brackets assumed stable. The calculator uses 2025-26 brackets for both years. If the federal government changes brackets in the 2026 budget, FY27 brackets will differ.
- Single individual taxpayer. SMSF, company, family trust, and joint disposal structures have different math; not modelled here.
Related tools
- Crypto CGT Calculator - single-disposal CGT with 50% discount.
- Tax-Loss Harvesting Calculator - offset gains with losses before EOFY.
- Portfolio Rebalancing Calculator - multi-asset CGT across a rebalance.
- CGT Comparison Calculator (2026 Budget) - for disposals planned across the 1 July 2027 budget transition.
- SMSF Crypto CGT Calculator - SMSF disposals with one-third discount.
Frequently asked questions
Capital gains are added to your assessable income in the financial year of disposal and taxed at your marginal rate for that year. If your income varies between years - because you change jobs, take parental leave, retire, or have variable bonus structures - your marginal rate also varies. Timing a large disposal into the year with the lower marginal rate can save thousands in CGT on the same gain.
A bracket transition saves between 6 and 15 percentage points of marginal rate per dollar of taxable income. On a $100,000 gain (after the 50% discount: $50,000 taxable), shifting from the 37% bracket to the 30% bracket saves 7pp × $50,000 = $3,500. Worth deferring for. On the same gain, shifting from the 16% bracket to the 0% bracket saves up to $7,200. Even a 3-4pp difference is worth deferring for on multi-thousand-dollar gains.
Usually yes, but two caveats. (1) Asset price risk: if you defer 6 months, the asset could fall 20% before you dispose, wiping out the CGT saving. Compare the saving against your price expectations. (2) ATO scheme detection: deliberately structuring disposals to dodge tax can attract Part IVA general anti-avoidance rules at very large scale. For typical retail-scale disposals (under ~$500k gain), the timing decision is normal tax planning and is not in scope. For multi-million-dollar disposals, consult a tax agent.
The 50% discount is applied first to the gross gain, then the discounted gain is added to taxable income. So a $100,000 gross gain on a 12-month-held asset becomes $50,000 taxable. That $50,000 is what sits in your bracket calculation. The discount eligibility (12-month hold) is independent of which FY you dispose in - both scenarios apply the same discount.
The 2026 federal budget announced changes to the CGT regime taking effect 1 July 2027 (FY 2027-28): CPI indexation of cost base plus 30 percent minimum rate on the indexed gain. These changes do NOT affect FY 2025-26 or FY 2026-27 - both are still under the legacy 50% discount regime. For disposals planned across the 1 July 2027 transition, use the CGT Comparison Calculator (2026 Budget vs Existing Rules) which models both regimes.
The 2 percent Medicare levy applies to taxable income above the threshold (AUD 27,222 for 2025-26 individual taxpayers). The calculator includes Medicare levy in both scenarios so the comparison is like-for-like. Medicare levy surcharge (additional 1-1.5% for high-income earners without private health insurance) is NOT modelled; if applicable to your situation, the actual CGT will be slightly higher than the calculator shows.
Yes, by disposing part of the position in each year. Half of the position sold before 30 June, half after, splits the gain between FY26 and FY27. This can keep both years within lower marginal brackets, avoiding the situation where one year's combined income + gain pushes you into a top bracket. The calculator does not model split disposals directly - run it twice with half the gain each time.
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