The accounting profession has started weighing in on the draft CGT apportioning formula released by Treasury on 4 August 2026. Two industry bodies, IPA and CPA Australia, have gone on record, making the same distinction that a valuation does not need to be completed by 30 June 2027, but rather reflect the asset’s market value as at that date.
IPA senior tax adviser Tony Greco confirmed this, stating that for assets with uneven growth, taxpayers may be better served by obtaining a formal valuation. Greco said, “For assets where growth has been uneven, taxpayers may be better served by obtaining a formal valuation, particularly where most of the growth occurred before 1 July 2027.”
Industry Views
Jenny Wong, CPA Australia tax lead, acknowledges that the proposed formula may be a lower-cost option for straightforward cases but cautions that it could put growth on the wrong side of the tax divide. Wong said, “A formula is only fair if it reflects reality. Australians whose asset did most of its growing before 1 July 2027, then flattened, will be disadvantaged under the apportionment methodology.”
The consistent view is that the formula may not be suitable for all assets, particularly those with complex or uneven growth. They cite multi-property portfolios, commercial and rural holdings, assets in volatile or shifting markets as examples where a formal valuation may be more reliable.
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A formal valuation completed as at 1 July 2027, prepared by a qualified valuer with current evidence, remains the more reliable way for a client to know their position. This is especially true for assets that have lived through market swings, such as the GFC crash, the pandemic, and record-low cash rates.
For simple, steadily appreciating property assets in a genuinely stable market, the formula may be a reasonable lower-cost option. However, for anything more complex, a market valuation completed by a qualified valuer is a more reliable choice.
The consultation on the draft CGT apportioning formula closed on 21 August 2026, and there is no word yet on whether changes will be made in response to submissions. Treasury’s parallel Tax Reform No. 3 Bill, covering related technical adjustments, is progressing through the same consultation window.
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