2026–27 Federal Budget: What Healthcare Practices need to know
- Mitchell Walmsley
- 14 hours ago
- 4 min read
Updated: 10 minutes ago
Short on time? Here’s the pulse on the 2026-27 Federal Budget:
Personal tax | $1,000 no‑receipt work deduction from 1 Jul 2026, plus a $250 annual offset from 2027–28 |
Capital gains | From 1 Jul 2027, the 50% discount on new gains is out; indexation is in, with a 30% minimum CGT |
Property | Negative gearing restricted for established properties bought after Budget night; new builds remain fully eligible |
For healthcare practices | Permanent $20k instant asset write‑off, company loss carry‑back, and payday super from 1 Jul 2026 |
Read on to learn what it means in clinic-speak and what to do next.
Personal tax
From 1 Jul 2026 | $1,000 instant work deduction. A flat $1,000 deduction for people who earn income from work. No receipts, optional. If your genuine deductions are higher, you can still claim the higher amount the usual way |
From 1 Jul 2025 | Medicare Levy thresholds rise 2.9%. Singles to $28,011; families to $47,238. Slightly lower levy for lower incomes and some dependants |
From 2027–28 | $250 Working Australians Tax Offset. An annual $250 offset against tax on wages, salary, or sole trader income. Not a cash payment, reduces tax payable |
What this means for clinicians
Employed doctors and allied health: expect a modest after‑tax boost; keep good records if your deductions beat $1,000
Contractor GPs/specialists: the offset still applies to business income; plan PAYG instalments accordingly.
Capital gains tax (CGT)
From 1 Jul 2027 | 50% CGT discount on new gains is replaced with cost base indexation. Pre‑1 Jul 2027 gains keep the current discount |
From 1 Jul 2027 | 30% minimum tax on net capital gains (Age Pension recipients exempt). Even if your marginal rate is lower, CGT won’t fall below 30% for gains arising from that date |
What this means for investors
If you’re considering selling shares, business assets, or an investment property in the next few years, timing matters. Pre‑1 Jul 2027 events may be more favourable; post‑1 Jul 2027 requires sharper strategy.
Property and negative gearing (residential)
From 1 Jul 2027 | Negative gearing restricted on established residential properties bought after Budget night. Losses on these can only offset rental income (not other income) |
New builds remain fully eligible for negative gearing | |
Now | Foreign buyer ban on established dwellings extended to 30 Jun 2029 |
For the typical doctor-investor
Existing properties are protected. Future purchases? If tax efficiency is a priority, new builds become relatively more attractive than established dwellings. Always weigh yield, location, and risk; tax is only one vital sign.
Superannuation
From 1 Jul 2026 | 30% tax on super earnings on balances above $3M (was 15%). Applies to the adjusted taxable income of the fund. Already law |
From 1 Jul 2026 | Transfer Balance Cap rises to $2.1M (max tax‑free retirement phase) |
From 1 Jul 2026 | Payday Super begins. Employers must pay super when wages are paid; must reach the fund within 7 business days |
For practice owners and high earners
High-balance strategy: consider contribution timing, asset location (inside vs. outside super), and spouse strategies
Payroll and cash flow: update payroll systems for payday super; tighten cash forecasting so super leaves with wages.
Business (greatest hits for clinics)
From 1 Jul 2026 | $20,000 instant asset write‑off becomes permanent for small businesses (turnover under $10M). Useful for fit‑out, IT, dental/clinical equipment, and software. Note: passenger vehicle deductions remain subject to the car cost limit |
From 1 Jul 2026 | Company loss carry‑back (global turnover under $1B). Turn a current‑year loss into a refund by offsetting tax paid in the prior two years |
From 1 Jul 2028 | Start‑up loss refundability (turnover under $10M, first two years). Early‑stage clinics and medtech ventures can convert losses into ATO cash |
From 1 Jul 2028 | R&D tax incentive reformed. Higher offsets for core R&D; “supporting” spend is no longer eligible. Minimum threshold lifts to $50,000. |
Action for health businesses
Lock in a rolling capex plan to maximise the permanent $20k write‑off.
If your company is scaling or seasonal, model carry‑back scenarios now.
If you’re doing genuine clinical or digital R&D, tighten your project documentation, and eligibility will be in sharper focus.
Trusts and service structures
From 1 Jul 2028 | 30% minimum tax on trust income for discretionary trusts. Details pending |
From 1 Jul 2027 | Three‑year rollover relief to restructure out of discretionary trusts (to a company or fixed trust) without triggering CGT |
Why this matters in healthcare
Many practices use service trusts. Scenario‑plan distributions, consider whether a company or fixed trust suits your growth and succession plan, and be ready to use the rollover window if it’s right for you.
Other measures worth a quick look
Fuel excise cut ends 30 Jun 2026 | Expect higher pump prices from 1 Jul 2026, budget for mobile practitioners and home‑visit teams |
EV FBT changes | Full FBT exemption runs to 31 Mar 2027. From 1 Apr 2027, only EVs under $75,000 keep the full exemption. From 1 Apr 2029, all EVs below the LCT threshold move to a 25% FBT discount (not a full exemption). |
If you’re considering an EV for your practice fleet or salary packaging, timing and price caps now matter more than the shade of metallic paint.
Key dates to circle
1 Jul 2025 | Medicare Levy thresholds lift |
30 Jun 2026 | Fuel excise cut ends |
1 Jul 2026 | $1,000 instant work deduction starts; payday super begins; 30% earnings tax on super >$3M; transfer balance cap to $2.1M; permanent $20k write‑off; company loss carry‑back |
1 Apr 2027 | EV FBT exemption tightens |
1 Jul 2027 | CGT discount changes; 30% minimum CGT; negative gearing restrictions for new established property purchases; restructure rollover relief opens |
1 Jul 2028 | Start‑up loss refundability; R&D incentive reform; 30% minimum tax on trusts (draft pending) |
1 Apr 2029 | EV FBT shifts to 25% discount for eligible EVs |
What to do next
Book an online 30‑minute Budget Debrief | We’ll map the changes to your salary, investments, and practice structure |
Run a 12–24 month tax timing review | Especially for CGT, property plans, and capex |
Tune up payroll for Payday Super | Test runs before 1 July 2026 |
Refresh your structure | Trust vs company modelling ahead of the 2027 - 28 windows |
Build an EV and fleet policy | If FBT savings are part of your benefits strategy, timing is everything |
This is general information based on the Budget announcements of 12 May 2026. Many measures require legislation. We’ll keep you updated with clear, actionable insights as these proposals are reviewed, legislated, and implemented.
*This article is general in nature and does not constitute personal financial or tax advice. The 2026-27 Budget measures discussed are subject to passing legislation. Always seek professional advice tailored to your specific circumstances.