What is the capital gains tax (CGT) discount?
The capital gains tax (CGT) discount reduces the tax on a profit when you sell an asset you’ve held for more than 12 months. For individuals and trusts the discount is 50% — you include only half the gain in your taxable income. For complying super funds it’s 33⅓%, and companies don’t get the discount at all. The 12-month holding period is the key to it.
By Justin Porrins, CFP® · SMSF Specialist Adviser™ · Last reviewed 25 June 2026
Why the holding period and the owner both matter
Hold an asset for less than 12 months and there’s no discount — the whole gain is taxed. And who owns the asset — you, a trust, a company or an SMSF — changes both the discount available and the rate the gain is taxed at. That’s why a decision made years before a sale can change the after-tax result more than the sale price does.
It’s a structuring question, not just a sale question
For a business exit or a property sale, the entity that holds the asset can shift the after-tax outcome substantially — and the small-business CGT concessions may also be in play. The time to think about CGT is when the asset goes in, not when it comes out.
Common questions
How long do I need to hold an asset to get the CGT discount?
More than 12 months. Sell within 12 months of acquiring the asset and the full capital gain is taxed, with no discount applied.
Do companies get the CGT discount?
No. The 50% discount is available to individuals and trusts, complying super funds get 33⅓%, and companies receive no CGT discount — one reason the holding entity is a deliberate decision.
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