CGT - Asset Valuation Timing

Source: Pilot Partners

With the new capital gains tax (CGT) rules commencing from 1 July 2027, asset holders, including business owners, are considering how to establish the market value of affected assets at 30 June 2027 to preserve the benefit of the current CGT regime for gains accrued up to that date.

While there has been speculation in the media that obtaining valuations may become difficult due to increased demand prior to 1 July 2027, a valuation generally does not need to be obtained on that date and can often be completed later, right up to the time of completion of the relevant tax return in which the gain is reported.

For business assets, valuations frequently rely on financial information that may not be available until after year-end when financial statements are prepared.

Maintaining appropriate records, which may include photographs and other supporting documentation for tangible assets, to demonstrate an asset's value and condition at 30 June 2027 is important, as this may help support any future valuation exercise and reduce potential disputes with the Australian Tax Office (ATO).