Compliance
Compliance Checklist for Digital Nomads under Australia’s New CGT & Negative Gearing Rules
From 1 July 2027 Australia will overhaul its capital gains tax and negative gearing rules, affecting overseas income holders and property investors. Whether you’re connected abroad or investing locally—***know when and how these changes hit you***.
By NomadicTax Research Team • 5-8 min read • July 2, 2026
## What’s Changing from July 2027
- **Negative gearing restrictions**: Only **new builds** qualify; losses from established residential property may only be deductible against **rental income or residential capital gains**, and any excess losses must be carried forward.([atotaxrates.info](https://atotaxrates.info/federal-budgets/budget-2026-for-2026-27/?utm_source=openai))
- **Capital gains tax (CGT)** reform: The long-standing **50% CGT discount** for individuals, trusts, and partnerships will be replaced by **cost-base indexation** for assets held more than 12 months. Additionally, a **30% minimum tax rate** on net capital gains will be introduced.([pwc.com.au](https://www.pwc.com.au/insights/federal-budget-tax-analysis-and-insights.html?utm_source=openai))
- **Exemption for foreign resident investors**: New builds retain discount eligibility; established properties generate drastically different tax profiles for non-residents. Digital nomads with foreign income ties should assess impacts.
## Digital Nomad Implications
- If you're earning income abroad, but paying CGT when you sell Australian property or assets, your holding period and when gain accrues matters: pre- and post-1 July 2027 rules will likely be treated separately. Losses before the changes may offset gains afterwards depending on legislation.([community.ato.gov.au](https://community.ato.gov.au/s/question/a0JMo0000050nAj/p00419541?utm_source=openai))
- Negative gearing of your investment in residential property may no longer give you deductions across general income if the property is not a new build.
## Actionable Planning Tips
- If planning to acquire or sell property or assets, **time the transaction** carefully: earlier than 1 July 2027, if possible, to take full advantage of existing deductions / discounts.
- Maintain records of acquisition dates, holding periods, costs including inflation measures for indexed cost base calculations. These will be essential after CGT changes.
- For digital nomads, staying aware of residency rules in Australia and how they interact with these property and CGT reforms is crucial: your tax liability depends on your status.
## Example Scenario
Alex, living part-year in Australia and overseas, owns a residential property bought in 2015 and currently held. If Alex sells in mid 2027:
- Gain accrued until 30 June 2027 may get old 50% discount.
- Any gain post-1 July 2027 computed via indexation, and subject to a minimum 30% rate on net gains.
If Alex plans future property acquisition, choosing a new build after 12 May 2026 may preserve more favourable treatment under negative gearing rules.