Before vs After 12 Months: The 50% CGT Discount
The 50% CGT discount is the single biggest factor in reducing your capital gains tax. This calculator shows you exactly how much you could save by waiting until you've held your asset for at least 12 months.
Many investors underestimate the impact. On a $100,000 gain, the discount can save over $20,000 in tax. See the numbers for your specific situation.
Scenario A: Sell before 12 months
Scenario B: Sell after 12 months
Applies to both scenarios
4 months after Scenario A
Scenario A
Sell before 12 months2025-26 Capital Gains Tax rates
Tax Comparison
Scenario B
Sell after 12 months2025-26 Capital Gains Tax rates
Tax Comparison
This calculator provides estimates only and does not constitute financial advice. Actual amounts may vary based on individual circumstances. Consult a registered tax agent for personalised guidance.
How to use this comparison
- Review the pre-filled scenarios — we've set up realistic defaults for comparison
- Adjust the numbers — enter your actual purchase price, sale price, and dates
- Compare the results — see the tax difference highlighted at the top
- Share or bookmark — the URL updates as you change inputs
How Capital Gains Tax Works
When you sell an asset for more than you paid, the profit is a capital gain. In Australia, this gain is added to your taxable income and taxed at your marginal rate. The amount of tax you pay depends on your total income that year, how long you held the asset, and whether any exemptions apply.
Key factors affecting your CGT
- Holding period: Assets held for 12+ months qualify for the 50% CGT discount, halving your taxable gain
- Your income: Higher income means a higher marginal tax rate on your capital gains
- Asset type: Your main residence is generally CGT-free; investment properties and shares are not
- Cost base: Includes purchase price plus costs like stamp duty, legal fees, and improvements
Use the calculator above to model your specific situation. Adjust the inputs to see how different scenarios affect your tax outcome.
FAQ
How much does the 50% CGT discount save?
The discount halves your taxable capital gain. At a 37% marginal rate, a $100,000 gain means $18,500 tax without the discount, but only $9,250 with it—a saving of $9,250. At 45%, the saving is $11,250.
Do I need exactly 12 months?
You need at least 12 months and one day. Selling on the anniversary of your purchase date does NOT qualify—you must wait until the day after.
Does the discount apply to all assets?
The 50% discount applies to most CGT assets for Australian resident individuals, but not to companies or assets acquired before 20 September 1985. Some collectables and personal use assets have different rules.
What if the market might drop while I wait?
That's the trade-off. If you expect a 10% price drop but the discount saves 20% in tax, waiting might still be better. This calculator helps you see the tax side; market timing is a separate decision.
Disclaimer
This tool provides estimates only and does not constitute financial advice. Investment decisions should not be based solely on tax considerations. Market conditions, investment goals, and personal circumstances all play a role.
Before making decisions about selling assets, consult a registered tax agent or licensed financial adviser.