27 April 2026 to 1 May 2026
Weekly Bulletin Contents
TAX
monday 27 APRIL 2026
Big changes in the wind for negative gearing too?
The Australian Newspaper on Sat 25 April 2026 reported in its lead article that Labor’s expenditure review committee is finalising key budget decisions likely to include negative gearing changes. Instead of capping the number of properties allowed, the focus has reportedly shifted to fully removing the tax break on existing properties, inclusive of grandfathering.
Institute of Financial Professionals Australia comment:
Budget day cannot come quick enough to see what changes are actually going to be made.
ATO: Income tax returns due soon for taxable NFPs
The ATO has issued a reminder that income tax returns are due soon for taxable NFPs. It said taxable NFPs with an income year ending 30 June must lodge their 2024–25 income tax return or non-lodgment advice by 15 May 2026. This due date does not apply if your NFP has an ATO-approved substituted accounting period. The ATO said to work out if you need to lodge an income tax return or if you should notify them of a ‘non-lodgment advice’, you need to check if your organisation is: a taxable NFP company, including incorporated and unincorporated associations; a taxable trust or partnership; and other taxable company, including incorporated and unincorporated associations.
tuesday 28 april 2026
Commissioner wins appeal – provision of council car park facility liable to FBT
The Full Federal Court has unanimously allowed the Commissioner’s appeal from the decision in Toowoomba Regional Council v FCT [2025] FCA 161. In that case, the Court ruled that a car park facility provided by the Toowoomba Regional Council to its employees in the Toowoomba CBD did not constitute a “commercial parking station” for FBT purposes and that therefore the Council was not liable for FBT. Specifically, the Court found that a “commercial parking station” implies a facility operated with a commercial purpose, such as generating revenue through fees charged to users but that the Council’s car park was provided as an incidental benefit to employees, free of charge, and was not operated for profit. However, the Full Court has now ruled that a profit-making operation is not a necessary integer for finding that a car park facility is “commercial parking station” for FBT purposes and that commercial in this context means to engage in commerce. (FCT v Toowoomba Regional Council [2026] FCAFC 50, 27 April 2026)
ATO: Qualifying earnings explained for super funds
The ATO has issued a reminder that from 1 July 2026, employers will move from calculating super contributions based on ordinary time earnings (OTE) to qualifying earnings (QE). The ATO said that this also has important operational impacts for the relevant fund. The move to QE underpins the broader shift to Payday Super and drives changes in contribution frequency, data quality and processing timeframes. In particular, the ATO emphasised that from 1 July, employers are responsible for super to (generally) reach super funds within 7 business days of payday, calculated on the QE amount and that as a fund, you will have 3 business days (down from 20 days) to allocate or return contributions that cannot be allocated.
wednesday 29 april 2026
Transfer balance cap to increase to $2.1m
The ATO has advised that for superannuation purposes the transfer balance cap will increase to $2.1m (from $2m) in the 2026-27 income years. At the same time, the defined benefit income cap will increase to $131,250 (from $125,000) in 2026–27.
Government response to recommendations to increase instant asset write off
The Government has responded to recommendations made in the Senate Economics Legislation Committee’s report on the Treasury Laws Amendment (Support for Small Business and Charities and Other Measures) Bill 2023. Among other things, some members of the committee had recommended increasing the instant asset write-off threshold to $30,000 and expanding eligibility to businesses with turnovers of up to $50m. However, the Government has now rejected this recommendation.
Cost base of building, not lease, to be increased for developer payment
In Brisbane Club v FCT [2026] FCA 220, the Federal Court has ruled that a taxpayer who acquired pre-CGT land was not liable for CGT in respect of a building constructed on the land as the relevant contract for the construction of the building was entered into pre-CGT. However, the Court found that the accompanying sale of two subleases in the building were subject to CGT as they had been acquired post-CGT. The Federal Court has now clarified that an indexed amount of $928,378 required to be paid to the Developer should, on a proper construction of the cost base rules, be included in the cost base of the building, and not the second sublease. (Brisbane Club v FCT (No 2) [2026] FCA 521, 28 April 2026)
thusday 30 APRIL 2026
Interim DIS on Hall case – no deduction for home office COVID rent
The ATO has released an interim decision impact statement in response to the Full Federal Court decision in FCT v Hall [2026] FCAFC 43. In that case, the Full Court unanimously ruled that a sports presenter was not entitled to deduction for a proportion of rent referable to a home office that he had to use to work from home during the COVID-19 pandemic. The ATO said that the Court’s decision supports the ATO views in the following public advice dealing with the deductibility of occupancy expenses and work-related transport expenses: TR 93/30 Income tax: deductions for home office expenses; TR 2021/1 Income tax: when are deductions allowed for employees’ transport expenses?; and Employees guide for work expenses.
Updated Ruling: identification of ’employer’ re short-term visit exception
The ATO has updated TR 2013/1 Income tax: the identification of ’employer’ for the purposes of the short-term visit exception under the Income from Employment Article, or its equivalent, of Australia’s tax treaties. It has been updated to align with TR 2023/4 Income tax and superannuation guarantee: who is an employee? and High Court and Federal Court decisions on the meaning of ’employee’ and ’employer’. TR 2013/1 explains the meaning of ’employer’ for the purposes of the short-term visit exception in the Income from Employment Article of Australia’s tax treaties. The draft update explains the employer is identified by determining whether a non-resident individual renders services in an employment relationship, applying the meaning of employee under Australian tax law consistently with the object and purpose of the exception. Where this treaty exception is satisfied, only the country of residence of the employee can tax the remuneration of the employee.
friday 1 may 2026
TPB obtains default judgment against tax agent for non-compliance
Following a tax agent’s non-compliance with court orders to file a notice of address for service and a statement in response, the Federal Court has now given default judgment against him by way of declarations, pecuniary penalties and permanent injunctions for alleged contraventions of the Tax Agent Services Act 2009. These alleged contraventions included the preparation and lodgement of income tax returns, amendments to income tax returns, and the preparation and lodgement of a BAS for taxpayers for a fee while not registered to provide such services. (Tax Practitioners Board v Hinckfuss (No 2) [2026] FCA 529,30 April 2026)
ATO rulings updated and withdrawn
The ATO has updated PS LA 2011/20: Payment and credit allocation by adding new paragraphs dealing with Global and Domestic Minimum Tax. In addition the ATO has withdrawn PS LA 2008/14: Record keeping when using commercial off the shelf software as the matter is now dealt with in Taxation Ruling TR 2018/2 Income tax: record keeping and access – electronic records.
APRA calls for a change in AI-related risk management and governance
APRA has called for a “step-change” in how banks, insurers and superannuation trustees manage AI-related risks as the technology continues to rapidly evolve. APRA warned that governance, risk management, assurance and operational resilience practices are not keeping pace with the scale, speed, and complexity of AI adoption. The letter outlines the findings of a targeted supervisory review APRA undertook late last year across all its regulated industries examining how AI was being deployed and governed. The review noted that the expanded use of advanced AI is introducing a range of new financial and operational vulnerabilities for entities, but that information security practices are struggling to keep up with the pace of change.
SUPER & FINANCIAL SERVICES
Don’t lose it: 2020-21 carry-forward cap expires 30 June
Clients with unused concessional contributions cap from the 2020-21 financial year have until 30 June 2026 to use it before it expires. Individuals can carry forward unused concessional cap amounts on a rolling 5-year basis. The 2020-21 unused amount is now in its final year of availability.
To make catch-up concessional contributions in 2025-26 using carried-forward amounts, a client must have a total superannuation balance of less than $500,000 as at 30 June 2025, and have unused concessional cap amounts from any of the previous five financial years.
Any unused 2020-21 amount not used by 30 June 2026 will be lost. Advisers should review client TSBs and contribution histories now to identify who may benefit before the deadline.
For more information see the ATO’s page on concessional contributions caps
ATO guidance on quarterly super to Payday Super changeover
The ATO has released new guidance to help employers manage the transition from quarterly super to Payday Super, which starts 1 July 2026.
From 1 July 2026, employers must pay super with each payday rather than quarterly. During July, many employers will need to manage more than one payment, including the final quarterly payment and one or more Payday Super payments for July paydays.
Key reminders for employers
- Final quarterly payment: the June quarter payment must be made by the 28 July deadline to avoid the super guarantee charge.
- First Payday Super payments: from 1 July, super must be received by employees’ funds within 7 business days of payday.
- July cash flow: employers should plan ahead for multiple super payments falling in the same month.
- Single Touch Payroll: reporting requirements change from 1 July.
Small Business Superannuation Clearing House: the SBSCH closes permanently on 1 July. Employers using it will need to download their records and switch to a new provider before that date.
Lifetime CGT cap rises to $1.935 million for 2026-27
The ATO has confirmed that the lifetime CGT cap will increase to $1,935,000 for the 2026-27 income year. The cap allows eligible small business owners to contribute proceeds from the sale of qualifying business assets to super without the amount counting towards their non-concessional contributions cap.
Institute of Financial Professionals Australia (IFPA) comment
The CGT cap is indexed annually in line with average weekly ordinary time earnings (AWOTE). The cap has nearly doubled since 2007-08, when it stood at $1 million. By contrast, the small business retirement exemption remains capped at a lifetime limit of $500,000.
ATO confirms 15-year CGT exemption: delayed sale still qualifies
In a recent private ruling, the ATO has confirmed that a retired couple can disregard the full capital gain on the sale of their former business premises under the small business 15-year exemption, despite their company having ceased trading some time before the sale.
Their company had run a retail business from the premises for over two decades before closing as a result of poor trading conditions arising from the COVID-19 pandemic. The property was then leased to an unrelated third party before being sold in a later income year.
As the relevant dates have been redacted in the published version of the ruling, the exact length of the gap is not known. The ruling also does not specify any timeframe the ATO considers acceptable. Prior ATO guidance includes scenarios suggesting around six months between a CGT event and retirement may be acceptable, but stresses each case turns on its own facts. The ATO accepted that the sale was sufficiently connected to retirement, allowing the full capital gain to be disregarded.
IFPA comment
The key takeaway is that whether a CGT event is sufficiently connected to retirement is assessed on a case-by-case basis. Here, the ATO was prepared to accept the connection even though there was a gap between the business ceasing and the property being sold.
APRA flags AI risk gaps at large super funds
APRA has written to all regulated entities, including superannuation trustees, setting out weaknesses found during a targeted review of AI adoption at large banks, insurers and super funds in late 2025. APRA found that AI is being adopted across all entities reviewed, but governance, risk management and assurance are not keeping pace. Common gaps include:
- Boards lacking the technical literacy to challenge AI risks, with overreliance on vendor presentations.
- AI being treated as “just another technology”, missing risks specific to adaptive models, bias, privacy and data handling.
- Weak controls over AI systems once they are running, being updated, or being retired.
- Heavy dependence on single AI providers, with limited contingency planning, exit strategies or contractual protections covering audit rights, model updates and incident notification.
- Staff using enterprise AI tools outside approved control frameworks, often only spotting issues after they happen rather than stopping them upfront.
Internal audit and risk functions lacking the skills to assess agentic workflows and probabilistic models.