Proposed Tax and Super Reforms

Labor’s win in the 2025 Federal election sets the stage for a wave of economic and tax reforms that could reshape the financial advice and accounting landscape.

Superannuation, trusts, wealth transfer and investment structures are on the radar with these proposals presenting both new risks and new planning opportunities for clients.

Here’s what’s on the horizon and how you can prepare.

1. Division 296: New Super Tax for High-Balance Accounts

Labor plans to implement the Division 296 tax, targeting superannuation balances over $3 million. As outlined in our previous article, Tax on Unrealised Capital Gains in Superannuation, earnings on the portion above this threshold would be subject to an additional tax.

What this means:
Clients with high balances may need to restructure their retirement strategies. We may need to be reviewing fund balances and modelling the impact of these changes.

2. Greater Compliance for Trusts and Family Groups

The Government is also focused on increasing transparency around trusts. Proposed measures would tighten compliance and reporting obligations, particularly for family group structures.

What this means:
Trusts will likely face more rigorous reporting standards, and the ATO will be better equipped to detect misuse. As your accountant, we should work with you to ensure trust deeds, distribution resolutions, and documentation are always up to date.

3. Wealth and Business Succession Reforms

Reforms aimed at intergenerational wealth transfer and business succession are also on the agenda. While specific legislation is still to come, these policies are designed to reduce structural inequity and close tax loopholes. Many are suggesting this is a sign inheritance taxes are on the way.

What this means:
Clients with family businesses or large estates may need to revisit existing plans. Asset protection, control mechanisms, and tax consequences will also need reviewing.

4. Potential Changes to Negative Gearing and CGT

Although not yet legislated, Labor has signalled interest in revisiting negative gearing rules and capital gains tax concessions — especially in relation to investment properties.

What this means:
If enacted, these changes could impact how clients borrow, invest, and time disposal of assets. As legislation changes you should be prepared to consider shifting scenarios.

Summary

While these reforms require support from the Senate to become law, the direction is clear: greater scrutiny, fewer concessions, and a stronger push for tax equity. This is the time to get ahead of the legislation and ensure you are protected — and well positioned — in a changing environment.

We offer Wealth & Financial Planning as one of our services. Please contact our team if you would like an introduction to our Finanical Planner, Tahsin Saricam, for a complimentary, initial conversation about your personal position.