If you held an established investment property before 7:30pm on 12 May 2026, the negative gearing changes do not apply to you. That protection is real, but it is narrower than a lot of investors assume, and the gaps are where people will get caught.
What grandfathering actually covers
Two groups are protected on negative gearing. First, anyone who owned a residential investment property before 7:30pm on 12 May 2026. Second, anyone who had signed a contract to buy before that moment, even if settlement happens later. Both keep the current rules: you can still deduct rental losses against your salary, indefinitely, on those properties.
Where the protection stops: the CGT side still moves
Grandfathering protects your negative gearing. It does not protect your capital gains tax position. The 50% CGT discount is being replaced from 1 July 2027 with cost base indexation and a 30% minimum tax on gains, and that applies to gains that accrue after 1 July 2027 on assets held by individuals, trusts and partnerships, including the property you bought years ago.
The mistake that resets your status
Grandfathering is attached to the property, not to you. Sell your grandfathered established property and buy a different established one after 12 May 2026, and the new purchase falls under the new rules. Investors who planned to trade up, or to sell an underperformer and rotate into a better-established asset, need to price that in.
Trusts and restructures need advice first
Moving a grandfathered property into a trust, or changing the ownership structure, can be treated as a disposal and reacquisition. That can knock out the grandfathered status and trigger the CGT consequences early. Get that modelled by your accountant before you move anything.
JSC Property Investments helps you plan your next move with a clear read on where you sit, alongside your adviser. Book a Kickoff Call with our team and let's map out what's next.