The reform coverage is full of technical shorthand. Here is what the key terms actually mean, in plain English. General information, not tax advice.
Cost base#
Broadly, what the tax system treats as your “starting point” for a property — usually the purchase price plus certain costs (stamp duty, some improvements, buying and selling costs). Your capital gain is the sale proceeds minus the cost base.
Cost base reset#
The reform’s central mechanism. Property held on 30 June 2027 (by individuals, trusts and partnerships) is treated as if it were sold and immediately bought back at its market value. The Act’s words for that value are market value just before 1 July 2027 (s 112-155(3)(a)) — in practice, an end-of-30-June-2027 valuation date, which is the date to put in a valuer’s instructions and the date that should appear on the report. That market value becomes the new cost base for gains after 1 July 2027. Elsewhere on this site we call it the “1 July 2027 reset value” for short.
Deemed disposal and reacquisition#
The legal fiction behind the reset: you don’t actually sell anything, but the law deems the asset sold just before 1 July 2027 and reacquired at market value on that date. “Deemed disposal”, “deemed sale” and “deemed acquisition” all describe this mechanism.
50% CGT discount#
The current rule: individuals (and trusts, in effect) who hold an asset for more than 12 months pay tax on only half the gain. Under the reform this discount is replaced for most post-1 July 2027 gains — but it is not abolished outright. It still applies to gains accruing up to 1 July 2027, and the Act keeps concessional treatment for two categories: new residential dwellings (50%, s 115-102) and affordable housing (up to 60%, s 115-125). Both apply automatically; the election in each case is to opt out in favour of CPI indexation, not to opt in. Whether a property falls into one of these categories is a question for a registered tax professional.
CPI indexation#
What replaces the discount: the cost base is adjusted upward in line with the Consumer Price Index, so only gains above inflation are taxed.
Negative gearing (reform changes)#
Deducting a rental property’s losses against your other income. Under the same Act, full negative-gearing treatment for residential property is limited to new builds, while properties held at the announcement are exempt — see the negative gearing changes explainer.
30% minimum tax on net capital gains#
Announced alongside indexation: a floor rate applying to net capital gains under the new regime — see how the new calculation works. How it interacts with your marginal rate is a question for a registered tax professional.
Market value#
What a willing but not anxious buyer would pay a willing but not anxious seller — established with evidence. The ATO’s market-valuation guidance expects comparable sales, clear methodology and a qualified, independent valuer.
Online estimate / AVM (CoreLogic, PropTrack, Domain)#
The instant property estimates from data platforms and portals — CoreLogic, PropTrack, Domain and realestate.com.au estimates are the ones forums mention most. They are algorithm outputs (automated valuation models): useful context, but no professional takes responsibility for the number, which is why they sit at the bottom of the evidence ladder for tax purposes.
Agent appraisal / CMA#
A real estate agent’s opinion of likely selling price (often a “comparative market analysis”). It is a marketing tool for listing decisions — not a signed valuation, and the agent is not an independent valuer. Investor forums regularly ask whether a free agent appraisal will do for the 1 July 2027 value; the ATO’s market-valuation guidance points instead to objective, supportable evidence from a qualified, independent source.
Desktop assessment#
An indicative value prepared and signed by a qualified valuer using comparable sales and property data, without a physical inspection. Because there is no inspection, the API Rules of Professional Conduct treat this as a desktop rather than a full valuation. Not the same thing as an online estimate — the difference is a professional forming and signing an opinion.
Kerbside (drive-by) valuation#
A limited-scope valuation where the valuer inspects the property from the street only. Sits between a desktop and a full inspection in scope and cost.
Bank valuation vs market valuation#
A bank (lender) valuation is prepared for the lender’s mortgage-risk purposes and is often conservative; it belongs to the bank, not to you. A market valuation for tax purposes is a different instruction with a different basis — forum threads regularly conflate the two. For CGT evidence, the instruction should be market value at the relevant date.
Contemporaneous valuation#
A valuation prepared at (or close to) the date it speaks to — e.g., a 1 July 2027 valuation prepared in mid-2027. The cleanest form of evidence, because the sales data is fresh.
Retrospective (backdated) valuation#
A valuation prepared later that assesses market value as at a past date. Entirely legitimate and commonly used — but harder and often costlier as evidence ages.
Pre-CGT asset (pre-1985 property)#
An asset acquired before 20 September 1985, historically exempt from CGT altogether. Under the legislated reform that blanket exemption ends for gains after 1 July 2027 — see pre-1985 property and the reform.
CGT event#
Tax shorthand for a moment that triggers a capital gains calculation — most commonly selling, but also gifting, transferring, or (under the reform) the deemed disposal on 30 June 2027.
Next: who is affected · why 1 July 2027 matters · valuation pathways compared
General education only — not tax, financial, legal or valuation advice. Speak with a registered tax professional about your situation.