The new property tax rules for retirement funds have many Australians worried. Starting July 1, 2026, the government will tax profits on investment properties held in self-managed super funds (SMSFs). This change is causing some investors to think about selling their properties early.
Under the current system, when you sell a property in your super fund after retirement, you don’t pay tax on the profits. The new rules will add a 15% tax on these gains. For people who bought properties years ago, this could mean paying thousands in taxes they hadn’t planned for.
Real estate agents are already seeing signs of panic. “Some clients are rushing to list their properties,” says Michael Johnson, a Sydney-based property specialist. “They’re worried about losing a big chunk of their retirement savings to this new tax.”
The changes will mostly affect the roughly 180,000 Australians who own property through their SMSFs. Many of these investors chose property because they understood it better than stocks or other investments.
Financial advisors suggest taking a deep breath before making hasty decisions. “Don’t rush to sell without looking at your whole financial picture,” recommends Sarah Chen from Retirement Planning Partners. “For some people, holding onto their property might still make sense despite the tax.”
The government says these changes will help make the super system fairer. They argue that tax breaks on property investments mostly benefit wealthier Australians. The expected $800 million in tax revenue will help fund other priorities.
Critics worry about the ripple effects in the property market. If too many investors sell at once, it could push prices down in some areas. This might be good news for first-home buyers but could hurt other property owners.
For those affected, there are several options to consider. Some might sell before the 2026 deadline to avoid the tax. Others might keep their properties but adjust their retirement plans to account for the lower after-tax returns.
“The smart move is to get professional advice tailored to your situation,” advises Chen. “What works for your neighbor might not work for you.”
The changes remind us that super rules can change over time. When planning for retirement, it’s wise to build some flexibility into your strategy. Having different types of investments—not just property—can help protect your savings from future policy shifts.
For now, the best approach is to stay informed and think carefully before making big decisions. Panic selling rarely leads to good outcomes. With almost three years until the new rules take effect, there’s time to make thoughtful choices about your retirement investments.
