CGT: Buying a new home before selling the old one
Brad Dickfos • February 17, 2026
If you find yourself in the position of having bought yourself a new home before you sold your existing home, there are important CGT issues to consider – and these centre on the fact that under the CGT rules, you cannot have two or more CGT exempt homes at the same time.
...However, there is an important concession that allows you to treat both the new home and the existing home as exempt from CGT for up to a period of six months – provided the new home actually becomes your main residence.
So, for example, in the simple case where you bought your new home on 1 February 2026 and then sell your existing one five months later on 1 July 2026, your existing home won’t be subject to any CGT – and your new home won’t lose any CGT exemption for this five-month period. However, the availability of this concession is subject to a number of important conditions.
Firstly, the existing home must have been your home for a period of at least three months in the 12 months period before you sold it. And, secondly, it must not have been used for the purpose of producing taxable income in any part of that 12-month period when you did not live in it.
So, in the above example, if you rented your existing home in the five-month period before you sold it (which vendors sometimes do while waiting to sell it), you could not use this concession to give you an additional five months of exemption on that home. As a result, you will be subject to a partial CGT liability to reflect the fact that your dwelling could not be treated as a main residence during this five-month period.
(But if this was the first time you rented it and it would otherwise have been entitled to a full main residence exemption just before you rented it, then you would calculate this partial CGT liability by reference to its market value when you first rented it and the amount you sell it for.)
However, the stringency of these conditions about the use of your existing dwelling in the 12-month period before you sell it can be alleviated by using another concession (the “absence concession”) to continue to treat it as your main residence, even if you rent it in this period.
In a similar fashion, you can use another concession (the “building concession”) to treat any land you acquire on which to build a new home as your new home for the purposes of this six month overlap rule.
However, in both these cases the application of these particular concessions, and their interaction with the rule that allows you to treat an existing home and new home as CGT exempt for up to six months, can be quite complex. And much will depend on the precise facts of the case.
If you find yourself in the position of having bought yourself a new home before you sold your old one (or are intending to do this) come and speak to us – and we will show you how the rules operate in your circumstances, and how they can be applied most advantageously.
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This article focuses on self-employed clients. If you’re a salary earner or retiree, you might find one of our other blogs more helpful.
There is much in the media about how the 50% capital gains tax (CGT) discount has contributed to the housing affordability problem in Australia (although no doubt the problem is a lot more complex than attributing it mainly to any taxation measure or measures).
Most of us keep a close eye on our bank accounts. But superannuation can be easier to lose track of, especially if you’ve changed jobs, moved house, changed your name, or simply set up a new fund and assumed everything followed you. That’s why the Australian Taxation Office (ATO) has issued a timely reminder. There is now $18.9 billion in lost and unclaimed super sitting across Australia. That’s up $1.1 billion since 2024 and spread across just under 7.3 million accounts. In other words, a lot of Australians have retirement savings that aren’t currently working for them and some of it could be yours. What “lost” or “unclaimed” super actually means Super doesn’t vanish, but it can go missing from your radar. It typically happens when an account becomes inactive and your super fund can’t contact you, or when you end up with multiple funds over the years. The ATO also holds certain amounts of super on behalf of individuals, for example, small inactive balances that have been transferred to the ATO, or other unclaimed amounts. The average amount of lost or unclaimed super is around $2,590 per person. That might not sound life-changing today, but over time it can grow into tens of thousands by retirement. A special note if you have an SMSF If you have an SMSF, this ATO update is particularly worth paying attention to. When you established your SMSF, you might have transferred most of your super across, but kept some behind, for example, to retain insurance cover through another fund. That means there could still be older super accounts from past jobs or retail/industry funds sitting in your name. The ATO is urging SMSF members to do a check, because a share of the $18.9 billion in lost and unclaimed super might be yours and could be rolled into your SMSF. One important practical tip is that if you locate lost super and want to move it into your SMSF, but your SMSF doesn’t show up as a transfer option in ATO online services, it’s often due to the fund’s compliance status. Take a moment to confirm your SMSF is listed as “complying” or “registered” on Super Fund Lookup. How to check for lost super (it only takes minutes) The ATO has made this super simple (pun intended!). You can: 1. Log in to myGov and go to ATO online services 2. Navigate to the Super section to view: Super held by the ATO Any lost or unclaimed accounts 3. Request a transfer to an eligible super account. Even if you don’t find anything, you’ll at least know everything is where it should be. Simple habits that help you stay on top of super Finding lost super is great but preventing it from happening at all is even better. A few easy habits can make a big difference: Keep your details up to date with your fund and the ATO so you stay contactable. Check whether you’ve got more than one account. Multiple accounts can mean multiple fees and duplicated insurance Consider consolidating if it suits your situation. Fewer accounts can mean lower fees and easier management but just be sure to check any insurance you might lose before rolling over Read your annual statement. It’s a quick way to confirm contributions, fees, returns, investment mix and beneficiaries. Why acting now matters Since 2022, the ATO has already reunited Australians with about $5.5 billion in previously unclaimed super. But there’s still nearly $19 billion waiting to be found. A few minutes today could translate into a healthier retirement balance later. It’s easy to put super in the “deal with it later” basket, but it’s still your hard-earned money. If you want a hand finding lost super, combining accounts, or moving money into your SMSF, reach out to us. We can guide you through the steps and make sure you’re able to claim any lost super without any hassles.
