The 1 July 2027 reset gives every property held on 30 June 2027 a new starting point — its market value at the end of 30 June 2027, just before 1 July. Two methods can set that value: a dated, independent valuation, or the Treasurer’s free apportioning method. These three worked examples show, in round dollars, when each method wins. All figures are illustrative — not quotes, not predictions, not advice.
See where a valuation pays off
How the two methods split the gain#
Both methods divide your total gain into a pre-2027 slice (still under the old 50% discount rules) and a post-2027 slice (under the new CPI indexation plus a 30% minimum tax rate on that gain):
- Dated valuation — uses the actual market value at the end of 30 June 2027. Pre-2027 gain = that value − your original cost base. Post-2027 gain = sale price − that value.
- The Treasurer’s apportioning method — compounds one constant growth rate across the time you owned the property; the portion of the holding period falling after 1 July 2027 is the post-2027 slice. (These examples use that compound method: one steady growth rate running from the purchase price to the sale price. It is checked against Treasury’s own worked examples to the cent. It is still an exposure draft, so confirm the final instrument with your accountant.)
For individuals, gain in the pre-2027 slice generally keeps the 50% discount, so a higher, well-evidenced 1 July 2027 value tends to place more gain there and less in the new regime — but only where the growth genuinely happened before the date. Where it did not, the formula can be the better call (see when the formula wins).
Illustrative tax assumptions. For the tax lines below: an individual on a 47% marginal rate; the 50% discount applies to the pre-2027 slice (so ≈ 23.5% of that gain in tax); the post-2027 slice is taxed at the 47% marginal rate (above the 30% floor), ignoring CPI indexation, which would reduce the post-2027 figure. Real outcomes depend on your rate, indexation, eligibility and circumstances. Illustrative only, not tax advice.
Recomputed 28 September 2026. These examples used to split the gain evenly across the holding period. They now use the exposure draft’s compound method, checked against Treasury’s own worked examples to the cent. The draft credits less value to 30 June 2027 than an even split, so the gap between the two routes is wider than the earlier figures showed.
Example A — steady-growth apartment#
An apartment bought for $600,000 in July 2017 and sold for $1,000,000 in July 2037 (a 20-year hold), growing at a steady rate of about 2.6% a year throughout. Its actual value at the end of 30 June 2027, the halfway point, is about $775,000.
| Method | 1 July 2027 value | Pre-2027 gain | Post-2027 gain | Illustrative tax |
|---|---|---|---|---|
| Dated valuation | $775,000 | $175,000 | $225,000 | ≈ $147,000 |
| Apportioning method | $774,543 | $174,543 | $225,457 | ≈ $147,000 |
Verdict: with steady growth, the formula’s one constant rate is the property’s real growth, so it lands almost exactly on the real value. The free formula gives essentially the same answer, so here it is the simpler, cheaper choice, and a valuation adds little. Honest is honest.
Example B — a suburb that boomed before 2027#
Same $600,000 purchase in July 2017, but the suburb boomed early: by 1 July 2027 the property is worth about $1,050,000, then growth flattens and it sells for $1,150,000 in July 2037.
| Method | 1 July 2027 value | Pre-2027 gain | Post-2027 gain | Illustrative tax |
|---|---|---|---|---|
| Dated valuation | $1,050,000 | $450,000 | $100,000 | ≈ $153,000 |
| Apportioning method | $830,588* | $230,588 | $319,412 | ≈ $204,000 |
*The formula never looks at the property. It grows the $600,000 purchase price at one steady rate that ends at the $1,150,000 sale price, and that puts about $830,588 at the reset.
Verdict: the boom happened before the reset, but the formula’s single steady rate can’t see that. It spreads the growth across 20 years and pushes $319,412 into the new post-2027 regime, against just $100,000 under the dated valuation. That’s about $219,000 more gain taxed under the less generous rules, and on these assumptions about $52,000 more tax. This is the case a dated valuation is built for.
Example C — a renovated property#
Bought for $700,000 in July 2015, with a $200,000 renovation in 2026 (an element 4 capital improvement), giving a cost base of $900,000. The renovation lifts the 1 July 2027 value to about $1,350,000; it sells for $1,450,000 in July 2035 (a 20-year hold, 8 years of it after the reset).
| Method | 1 July 2027 value | Pre-2027 gain | Post-2027 gain | Illustrative tax |
|---|---|---|---|---|
| Dated valuation | $1,350,000 | $450,000 | $100,000 | ≈ $153,000 |
| Apportioning method | $1,083,513* | $183,513 | $366,487 | ≈ $215,000 |
*The formula grows only the $700,000 purchase price. The renovation is in the cost base but not in the growth, so the formula puts about $1,083,513 at the reset, well below the $1,350,000 the renovated property was actually worth.
Verdict: the renovation created a step-up in value before 2027, and the formula cannot see it: it grows the original purchase price, not the improved property. A dated valuation captures the renovated property as at the reset, keeping more gain in the pre-2027 slice. That is about $63,000 less tax on these assumptions. The lesson pairs up: keep the renovation invoices and a value as at the end of 30 June 2027 that reflects the finished work.
When the free formula wins#
A dated valuation is not always the answer. If your property’s growth came mostly after 1 July 2027, its actual value on that date is low — a valuation would then set a low starting point and expose a larger slice to the new regime, while the formula’s one steady rate assigns less. Where growth was steady, the formula lands close (Example A) and saves you the cost. The point is not that one method always beats the other — it is that the choice is elective, and worth checking against your property’s real history with your accountant.
Try your own numbers#
Illustrative general information, not tax advice. Excludes buying/selling costs, the CGT discount calculation, indexation, exemptions and your marginal rate; SMSFs and companies are excluded from the reform for property acquired on or after 20 September 1985 (pre-CGT property is deemed sold whoever holds it). Confirm with your accountant.
Where to go next#
- New to the mechanics? Start with how to calculate your CGT cost base.
- Make sure your evidence stacks up — the records checklist.
- The homepage explains the reset in full and compares valuation vs the formula.
- Want a dated value as at the end of 30 June 2027? On-site (full inspection) from $759 — the level to use where the ATO may test the figure. A desktop is cheaper ($329 unit / $384 house, complex properties from $439) but is not inspected, so it suits monitoring rather than a CGT cost base (a valuation done later is retrospective, quoted separately). All prices include GST. Reserve at CGT Valuation Ready, an independent valuation service. Accountants can access wholesale pricing and batch submission at the Valuation Ready partner portal.
Register interest#
Our valuer panel is being built state by state, so a valuer may not yet be available for your property — we tell you before you proceed, not after.
Common questions#
Can you show a 1 July 2027 cost base reset example?
Is the Treasurer's free apportioning method always worse than a valuation?
How does the apportioning method work?
Why can a dated value beat the free formula?
Do the examples include the CGT discount and my tax rate?
Are SMSFs or companies covered by these examples?
General information only — not tax, financial or legal advice. All dollar figures are illustrative and rounded. Any indicative appraisal is automated and is not a certified or ATO-suitable valuation; the signed valuation is provided separately.