Hasel Calderon Content & Digital, Murray Property · Darlinghurst & Surry Hills specialist
EOFY is easy to treat as an admin exercise, collect receipts, send them to your accountant, move on. But for Sydney property investors, particularly those holding in Darlinghurst, Surry Hills, or anywhere in the Eastern Suburbs, the 2025–26 financial year is more consequential than most. The Federal Budget changes announced in May mean 30 June 2026 is effectively the last clean EOFY before the biggest overhaul of property investment tax rules in a generation.
This is the checklist. Not an exhaustive tax guide, that’s your accountant’s job, but a clear-eyed look at what needs to happen in the next seven days, what can wait until after 1 July, and what the Federal Budget changes mean for how you think about your investment from here.
What the Federal Budget actually changed, and when
Before the checklist, it’s worth understanding the landscape you’re operating in, because it affects how you approach several of the decisions below.
The May 2026 Federal Budget announced two major changes to property investment tax rules, both taking effect from 1 July 2027:
Federal Budget 2026. Key changes for property investors
Negative gearing: From 1 July 2027, negative gearing on established residential properties purchased after 7:30pm AEST on 12 May 2026 will be limited, rental losses can only be offset against property income, not wages or other income. Properties held before Budget night are grandfathered under existing rules. New builds remain fully exempt.
Capital gains tax:T he 50% CGT discount will be replaced by cost base indexation from 1 July 2027, with a 30% minimum tax on capital gains. The change applies to gains accruing after 1 July 2027 only, gains accrued before that date are treated under transitional rules. Note: this legislation has not yet passed Parliament and may change.
What this means practically: if you purchased an established investment property after 12 May 2026, you are subject to the new negative gearing rules from 1 July 2027. If you purchased before that date, you are grandfathered under existing rules as long as you hold. There is no immediate change to your 2025–26 tax return, but the rules under which you will eventually sell are shifting, and that affects strategy decisions worth making now.
30 June the checklist
1. Get your records in order now
Your accountant needs everything that happened with your property between 1 July 2025 and 30 June 2026. The better your records, the more your accountant can legitimately claim. Start gathering:
-Any professional fees, solicitor, accountant, quantity surveyor
-Annual income and expense statement from your property manager (request this now if you haven’t received it)
-All rental income received, including regular rent, insurance payouts for lost rent, and any bond amounts retained
-Council rates, water rates, strata levies, and land tax notices
-Landlord and building insurance premium invoices
-Loan statements showing interest charged for the year
-Receipts for all repairs and maintenance carried out during the year
-Property management fee statements
Repairs vs capital improvements, a common and costly mistake. A repair restores something to its original condition and is generally deductible in the year it occurs. A capital improvement makes the property better than it was and must be depreciated over time. Misclassifying these is one of the most common errors the ATO actively looks for in rental property returns. If you did any significant work on your property this year, discuss the classification with your accountant before lodging.
2. Action prepaid deductible expenses before midnight 30 Jun
Under the ATO’s 12-month prepayment rule, individual investors can prepay up to 12 months of eligible deductible expenses and claim them in the current financial year. For property investors, the most common prepayable deduction is loan interest, and with interest rates at 4.35% on an investment loan, the deduction is material.
If your lender allows interest prepayment, paying the first 12 months of FY26–27 interest before 30 June means that amount is deductible in your 2025–26 return rather than next year’s. This is particularly valuable if your marginal tax rate is higher in 2025–26 than it will be in 2026–27. Note that income tax rates for lower income brackets reduce from 1 July 2026, meaning a dollar of deduction is worth more this financial year for some investors.
Other expenses worth prepaying before 30 June if due in the next 12 months: landlord insurance premiums, property management retainer fees where applicable, and any professional subscriptions relevant to your investment activities.
Action, do this before 30 June. Call your lender and ask whether interest prepayment is available on your investment loan. If it is, the calculation is straightforward: annual interest × your marginal tax rate = approximate tax saving. Run the numbers with your accountant before actioning.
3. Check whether you have a depreciation schedule, and whether it’s current
A quantity surveyor’s depreciation schedule is one of the most consistently underutilised tax tools available to Australian property investors. It identifies two types of deductions: capital works deductions (the building structure and fixed items, claimable at 2.5% per year for buildings constructed after July 1987) and plant and equipment depreciation (appliances, carpet, blinds, and other removable assets).
Even if your property was built before 1987, you may still be able to claim depreciation on newer renovations, updated fixtures, or fittings installed after the original construction. A depreciation schedule is a once-off cost, typically $500–$800 for a residential property, that can generate thousands of dollars in annual deductions and pays for itself in year one.
If you don’t have a schedule, or your property has been renovated since the last one was prepared, EOFY is the right time to commission one. The deductions it unlocks apply retrospectively to the current financial year if the report is completed before you lodge.
Action, this week. If you don’t have a current depreciation schedule for your Darlinghurst or Surry Hills investment, contact a quantity surveyor this week. The Federal Budget changes make depreciation schedules more important than ever, they help investors track cost base and calculate future CGT liability under the new indexation framework from 1 July 2027.
4. Review your loan structure before 30 June
EOFY is the natural moment to ask whether your investment loan is still working as hard as it should be. With the RBA cash rate at 4.35% and lenders competing for business, the gap between your current rate and a comparable product from a different lender may be significant.
One specific issue to address: if you have ever redrawn from your investment property loan for personal spending, a holiday, a car, home renovations, the interest on that redrawn amount is not deductible. The ATO has increased scrutiny on mixed-purpose loans, and the EOFY moment is the right time to discuss loan purpose and contamination risk with your accountant and broker. Addressing it now is significantly easier than managing a tax audit later.
5. Review your rent against the current market
This one is often overlooked in the EOFY rush, but it belongs on the checklist. Under NSW rental law, rent can only be increased once every 12 months. If your last rent review was more than 12 months ago, you may be able to issue a rent increase notice now, and any additional rent collected from the effective date will be income in the new financial year.
In Surry Hills, current market rents for units are running at $775–$800 per week. A tenant paying $700 per week on a lease that has rolled over without review is costing you $3,900–$5,200 per year in foregone income. EOFY is the moment to ask your property manager whether a review is due, and if so, to action it promptly.
6. Consider the timing of any capital gains events
If you sold, or are considering selling, an investment property, the contract date (not the settlement date) determines which financial year the capital gain falls in. A contract exchanged before 30 June 2026 crystallises a gain in the 2025–26 financial year. A contract exchanged on or after 1 July falls in 2026–27.
Under the existing CGT rules (which apply to all gains accrued before 1 July 2027), assets held for more than 12 months qualify for the 50% CGT discount. That discount remains in place for gains accrued up to 30 June 2027, even under the transitional rules. If you’re planning a sale, your accountant can model the difference in tax outcome depending on contract timing, and it can be significant at the margins.
The CGT grandfathering window, act now if applicable. Properties purchased after 12 May 2026 are subject to the new negative gearing rules from 1 July 2027. But the 50% CGT discount on gains accrued before 1 July 2027 still applies under transitional rules. If you are holding an investment property and considering selling in the next 12–18 months, speak to your accountant about how the transitional framework affects your specific situation before making any decisions.
Key EOFY deadlines at a glance
| Action | Deadline | Status |
|---|---|---|
| Super concessional contributions (must be received by fund) | ~25 June (allow 5+ business days) | Act now |
| Prepay investment loan interest (up to 12 months) | 30 June 2026 | This week |
| Prepay landlord insurance, management fees | 30 June 2026 | This week |
| Exchange contract on property sale (to crystallise gain in FY26) | 30 June 2026 | Speak to accountant |
| Commission depreciation schedule (to claim in FY26 return) | Before lodgement | This week if possible |
| Gather all rental income and expense records | Before lodgement | Start now |
| Review rent against current market, issue increase notice | Anytime, effect in FY27 | Action after 1 July |
| Review loan structure and refinance | No deadline, ongoing | Speak to broker in July |
| Lodge tax return (self-lodge) | 31 October 2026 | Via registered tax agent if later needed |
One more thing: don’t panic-buy deductions
It’s worth saying directly: spending $1,000 on something you don’t need to save $370 in tax is still $630 out of pocket. EOFY moves should be things you’d do anyway, prepaying known bills, reviewing rent, sorting your depreciation schedule, topping up super if you have the capacity. Buying equipment, making repairs, or committing to expenses purely for the tax deduction rarely makes financial sense once the numbers are run honestly.
The best EOFY strategy for a Surry Hills or Darlinghurst property investor is the same as the best long-term property strategy: be organised, be proactive, and speak to your accountant before you act, not after.
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Disclaimer
The data, figures, and market statistics referenced in this article were current at the time of publication and are sourced from third-party providers including CoreLogic/Cotality, Domain, realestate.com.au, HtAG Analytics, PropTrack, and NSW Fair Trading, among others. Property market data changes frequently, median prices, rental yields, vacancy rates, clearance rates, and days on market figures are updated regularly by their respective providers and may have changed since this article was published. Readers are encouraged to verify all figures directly with the cited sources before making any decisions.
This article is intended as general information only. It does not constitute financial, investment, legal, or taxation advice. The information provided does not take into account your individual circumstances, objectives, financial situation, or needs. Before making any property investment, purchase, sale, or management decision, you should seek independent advice from a qualified financial adviser, solicitor, or property professional licensed in your state.
Murray Property is a licensed real estate agency operating in NSW. We are not financial advisers. References to rental yields, capital growth, or investment returns are based on publicly available market data and historical performance, which is not a reliable indicator of future results.
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