Clear Tax Explains What Business Owners Need to Know About Capital Gains Tax in 2026

MELBOURNE, Australia - Nov. 12, 2025 - PRLog -- Many Australian business owners face a surprise tax bill when selling a property, shares, or business equipment, simply because they don't fully understand how Capital Gains Tax (CGT) works. According to Clear Tax, planning ahead can make all the difference.

"Capital Gains Tax often catches people off guard," says Ash Jindal, Director at Clear Tax. "It's not a separate tax, but part of your income tax, and how you manage it can have a big impact on your overall finances. The key is knowing the rules before you sell, not after."

What Is Capital Gains Tax and When Does It Apply?

CGT applies when you make a profit from selling a business asset, such as commercial property, shares, or business equipment. The tax is calculated on the difference between what you paid for the asset and what you sold it for.

But not every transaction triggers CGT. The tax only applies when a "CGT event" occurs — for example, selling an asset, transferring ownership, or ceasing to be an Australian resident. Even using part of your home for business could have CGT implications later when you sell the property.

• 15-Year Exemption: If you've owned an asset for at least 15 years and are over 55 and retiring, you may be fully exempt from CGT.
• 50% Active Asset Reduction: You can reduce your capital gain by half if the asset was used in your business for at least 12 months.
• Retirement Exemption: You may claim up to $500,000 in lifetime CGT exemptions when retiring, paid into super if under 55.
• Small Business Rollover: If you sell an asset but reinvest in a new one, you can defer your CGT for up to two years, or longer in some cases.

Common CGT Mistakes to Avoid

Many business owners lose valuable tax benefits simply because they don't prepare ahead of time. Clear Tax warns against common pitfalls such as:

• Failing to keep detailed records of asset purchases or improvements
• Mixing business and personal use without proper documentation
• Changing ownership structures without checking CGT implications
• Selling before meeting the minimum time requirements for concessions

"These mistakes are easy to make, but with the right planning, they're just as easy to avoid," Jindal adds.

He advises business owners to review their assets and structure well before any sale. "Even a simple change today can affect your eligibility years down the track," he says. "The earlier you seek advice, the more control you'll have over your financial outcome." Reach us now: https://cleartax.com.au/