Global Daily Tax News, Australia Announces CGT Concession For Angel Investors, (Jun 22, 2026)

The Australian Government has announced proposals for new capital gains tax concessions for small businesses and startups.

Building on commitments made in the Budget to reform the capital gains tax rules, on June 18, 2026, the Government has:

• Announced an increase to the turnover threshold for the existing small business 50 percent active asset CGT reduction from AUD2m to AUD10m; and

• Released a consultation paper on the design of a new Innovative Business CGT Concession that would provide a 50 percent CGT discount to early-stage investors including founders and employee share scheme participants of innovative start-up businesses.

The Government said the decision to extend the eligibility of the 50 percent active asset reduction to more businesses will mean that all 2.7 million active small business and 98 percent of active businesses will be eligible for a 50 percent CGT discount on active business assets, on top of the discount for inflation where eligible once these reforms are in place.

The Innovative Business CGT Concession will provide individuals, partnerships, and trusts holding eligible shares a choice between a 50 percent discount or indexation and the minimum tax for gains accrued from July 1, 2027.

The current proposals provide that eligible shares must be new equity issued by a company that is under 10 years old (or under 15 years in certain circumstances) and that has under AUD50m in turnover, and principles-based innovation criteria must be met. The shares must be held for five years before being sold, with a lifetime cap on the concession.

The Government said, "This will ensure that early investors in innovative start-ups that start with a low or zero cost base still receive a significant discount on a future capital gain, supporting the continued growth of Australia's start-up and venture capital ecosystem."

"The Government will consider expanding eligibility to 15 years for start-ups in sectors such as biotech and medtech that can take longer to commercialize."

Feedback is being sought until July 10.