On 4 August 2026, the Treasury published a draft legislative instrument outlining the “apportioning method”, a formulaic approach to valuing assets. This method, introduced under the Treasury Laws Amendment (Tax Reform No. 1) Act 2026, is detailed in the Income Tax Assessment (Method for Apportioning Capital Gains and Capital Losses) Determination 2026. The draft instrument applies to assets, including real property, that lack a readily determinable market value. Notably, this approach can only be utilized when an asset is actually sold, and does not provide a current or future value as of 1 July 2027.
Understanding the Apportioning Method
The apportioning method involves calculating a theoretical value as of 1 July 2027 by retrospectively applying a constant growth rate to the asset’s entire holding period, based on its eventual sale price. Key dates, such as the 1 July 2027 deemed disposal and reacquisition date and the 30 June 2027 asset-scope reference date, remain unchanged. The consultation period for the draft instrument closes on 21 August 2026, and the legislation is not yet finalized. The method assumes a uniform rate of growth over the asset’s holding period, which may not accurately reflect the asset’s actual value fluctuations.
As the apportioning method can only be applied after an asset’s sale, it does not provide property owners with certainty regarding their asset’s value as of 1 July 2027. Instead, it offers certainty only after the fact, which can be years or even decades later. This can lead to difficulties in sourcing evidence and increased potential for disputes. The risks associated with this method are particularly pronounced for complex portfolios, commercial holdings, and assets held in detailed structures, where a single average growth rate may not accurately capture the asset’s value movements.
In such cases, a market valuation conducted by a qualified valuer as of 1 July 2027, using current evidence and a robust methodology, remains the most reliable means of determining an asset’s value. This approach provides a snapshot of the property’s value at a specific point in time, rather than relying on assumptions about its growth trajectory.
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Preparing for the Future
To assist property owners in preparing for the 1 July 2027 changes, Acumentis is now accepting early bookings. A 20% deposit secures a valuation slot and guarantees the current pricing. By booking early, property owners can ensure their place in the schedule and lock in the current price, ahead of the anticipated demand surge closer to the deadline.
Acumentis offers a valuer-signed figure that provides a defensible value for tax purposes. By booking early, property owners can secure a confirmed booking, today’s price, and priority access to a local valuer. Single residential properties start at $600 + GST, while portfolios and specialized properties are quoted individually.
Please note that this update is for general information purposes only and does not constitute financial, tax, or legal advice. Acumentis is not licensed to provide financial or tax advice, and property owners should consult their accountant or financial adviser to understand how these changes apply to their specific circumstances.
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