For years, investors built up property and share portfolios then sold in retirement when their marginal tax rate could fall to almost zero, sidestepping big capital gains tax bills. A new rule added late to the federal capital gains tax overhaul imposes a “top‑up tax” forcing self‑funded retirees on a zero tax rate to still pay at least 30% on relevant investment gains, blocking any attempt to structure retirement income so that the CGT bill drops below that threshold.
Financial advice firms that spent decades urging clients to buy and hold assets through their working lives are only now unpacking the change. Many of those strategies assumed retirees could realise gains later and benefit from low or nil marginal tax rates. Advisers now have to revisit how property and share portfolios are managed before and after retirement, and model how the new top‑up tax interacts with superannuation, pension structures and existing CGT discounts.
