Beyond the Balance Sheet Q3 2026

From the Directors

Welcome to Q3

Welcome to the Q3 edition of Beyond the Balance Sheet. The dust is settling after one of the most consequential 1 July dates in years, and there is still plenty to navigate. Payday Super is bedding in, the CGT and trust reform legislation has passed, Division 296 is now in effect, and fuel relief has ended. On top of all that, it's tax return season.

We've packed this edition with the practical information you need to stay across it all. As always, if anything here raises a question about your specific position, don't sit on it - give us a call.

Instant Asset
Write-off

On Wednesday 19 August 2026 the Instant Asset Write-off was made permanent, up to a $20,000 limit

Industry
Insights

Fuel Excise Relief has ended. Are you claiming everything you are entitled to?

Whats on
at YBM

We spill the tea on whats happening at YBM. Staff updates, our fundraising activities and more award nominations

Feature Articles · Superannuation

Division 296

What It Means for You Now

The new tax on large super balances is here

From 1 July 2026, Division 296 is law. If your total superannuation balance (TSB) exceeds $3 million at 30 June, an additional 15% tax applies to the earnings attributable to your balance above the threshold. A second threshold applies for TSB over $10 million. Note that your TSB is the combined balance of your superannuation in all funds, whether self-managed, industry, retail funds or other.

There are some important and unusual features of this tax that every affected trustee and member needs to understand.

How the tax is calculated

Earnings will include income from investments, including rent, interest, dividends and distributions. It will include capital gains realised when investments are sold but will no longer include unrealised capital gains (proposed in a previous version of the tax). There is also an opportunity for SMSFs to 'opt in' to special relief allowing capital gains to be adjusted to only reflect growth since 30 June 2026. Market valuation of all assets at 30 June 2026 will be essential.

The ATO will calculate your Division 296 liability based on your annual TSB movements. The proportion of superannuation within each threshold will be calculated at 30 June 2027 in the first year. In future years, proportions will be based on the higher balance of 1 July or 30 June in that financial year.

The tax is then assessed by the ATO on the individual member, not the fund. It is payable by the member personally, however special rules will allow the tax to be paid from their super if they wish, even if not old enough to access super under normal circumstances.

⚠ Book Your Division 296 Review

If your balance is at or approaching $3 million, or if it would be close to this balance should you inherit a spouse's super, book a consultation with our team now.

Call 02 6362 1533 or email mail@ybm.com.au.

What you can do

Review your TSB - if you are above or close to $3 million, contact us immediately
Consider whether assets can be repositioned or restructured within the fund to manage the earnings base
Explore pension and accumulation account structures with your YBM financial adviser
If you have illiquid assets, plan for how Division 296 liabilities will be funded
Spouses with lower balances - consider contribution and balance equalisation strategies for future years

Feature Articles · Budget Update

CGT & Trust Measures

What's Now Law

The most significant overhaul of CGT since 1999

The Treasury Laws Amendment (Tax Reform No. 1) Bill 2026 passed both houses of Parliament in late June 2026, with the Greens joining the government in the Senate to block a Coalition attempt to delay the vote. Here is a clear summary of what is now law, what has been carved out, and what is still to come.

What has passed into law (as at the end of August 2026)

The 50% CGT discount for individuals and trusts is replaced by cost base indexation and a 30% minimum tax on net capital gains - effective 1 July 2027
All pre-CGT assets (including those held by companies) are brought into the CGT regime from 1 July 2027
Negative gearing is restricted to new residential property for purchases made after 12 May 2026 - existing investors are grandfathered
The small business active asset CGT concession threshold rises from $2 million to $10 million turnover - a significant win for regional businesses
An SMSF residential property borrowing ban commenced 10 August 2026 - existing limited recourse borrowing arrangements are grandfathered
The Working Australians Tax Offset and $1,000 standard work-related deduction are included in the same bill

What is still to come - Discretionary Trusts

The proposed 30% minimum tax on discretionary trust distributions has not yet been introduced to Parliament. It remains a policy intent with a technical bill flagged for later in 2026. The effective date is currently 1 July 2028, giving trustees time to plan.

Testamentary Trusts

All types of testamentary trusts are intended to be exempt from the proposed 30% minimum tax on trust distributions. This exemption is conditional on the bill being passed in its current form - it is not yet law. We will keep you updated as the legislation progresses.

Carve-outs and exemptions

Owners of new residential properties may choose either the 50% discount or indexation - effectively exempt from the measure
Commercial property and other asset classes such as shares remain subject to existing arrangements for negative gearing
Small businesses with turnover under $10 million retain access to the 50% active asset CGT concession
A startup CGT concession (the Innovative Business CGT Concession) is in design - consultation is still underway and legislation is not yet drafted
New this month is the announcement that discretionary trusts making fixed distributions to nominated beneficiaries may be exempt from the proposed 30% minimum tax

Industry Insights · On the Radar this Quarter

Fuel Excise - Are You Claiming Everything You Are Entitled To?

Fuel tax credits could be putting money back into your business — but are you claiming everything you're entitled to? We break down who can claim, how it works and what to watch.

Read the full guide here.

Check Your FTC Rate

If your business claims fuel tax credits, you need to use two different rates across the Q1 2026-27 BAS period: 1 July - 2 August (reduced rate), 3 August onwards (full restored rate).

The ATO has published updated FTC rates at ato.gov.au. If you are unsure which rate applies to your activities or vehicles, contact us before lodging.

Agriculture

Income Averaging for Primary Producers - Making sense of your tax return

Farming income can swing dramatically year to year. Income averaging is a tool that can smooth your tax liability across the good years and the lean ones - but it's not right for every situation and the rules around eligibility and opting out are worth understanding.

Read the full guide here.

Construction

Australia is on track to deliver only 1.03 million of the 1.2 million homes targeted by July 2029, and the Orange and Central West region is feeling both sides of that equation. Demand for local builders and trades is strong - but labour availability, materials costs, and margin pressure are real constraints for businesses trying to keep up.

With the negative gearing changes locked in for new residential property from 1 July 2027, clients in the residential construction space should be thinking ahead. If you're considering equipment or asset purchases, speak to us before committing - the Instant Asset Write-Off and CGT planning are both relevant here.

Healthcare

Bulk-billing rates continue to climb, reaching 81.9% nationally for the January-March 2026 quarter - up 4.6 percentage points year-on-year - though the pace of growth has slowed since the initial surge following the expanded incentives launch. NSW sits above the national average at 85.6%, also up 4.0 percentage points on last year.

For Central West practice owners, the incentives are helping - but the underlying economics of running a practice remain tight. Payroll structuring, contractor arrangements, and forward planning for 2026-27 all warrant a close look as the sector continues to adjust.

Tea Time at YBM

What's Brewing in the Back Office

Stepping Out for Lifeline Central West

This month (September), the YBM team are taking part in the Out of the Shadows Walk, raising funds and awareness for suicide prevention. On 10 September, World Suicide Prevention Day, we walked 9km through Orange in support of Lifeline Central West and the important work they do in our community.

If you'd like to support Team YBM, you can donate via our fundraising page: outoftheshadowswalk.org.au/fundraisers/ybmptyltd

Welcome to the Team: Pavan and Candice

Pavan Ungarala joined our Accounting team in July, and Candice Mosch joined us in June in Orange Reception. We will provide more info about them both on our socials soon.

Chasing Dreams: Alex Heads to the UK

We recently said goodbye to Alex Wolters, who has swapped the YBM office for an exciting new adventure in England. Alex is following her passion for Eventing, where she'll be competing and working with an Australian rider based in the UK. While we'll certainly miss having her as part of the team, we're thrilled to see her chasing her dreams and wish her every success for the adventure ahead!

Awards Season at YBM

We're thrilled to share that YBM has been named a finalist in not one but two categories at the 2026 Orange Business Awards - Excellence in Medium Business and Employer of Choice (21 Employees & Over). Being recognised in both categories reflects everything our team works hard for every day: strong client outcomes, and a workplace culture people genuinely want to be part of.

It's a great chance to celebrate alongside some outstanding businesses across the Orange region. We'll keep you posted on how we go.

"Great workplaces create great teams, and great teams deliver great outcomes for our clients."

Tax Talk · Tips & Insights

Key Changes in Your Tax Return

$1,000 work deduction

Claim the standard deduction without receipts, or claim more with substantiation.

Tax offset

The new Working Australians Tax Offset applies for 2025–26.

Super contributions

Check contributions and carry-forward amounts are correctly recorded.

Rental properties

Expect greater ATO scrutiny of deductions and apportionment.

HELP

The 20% reduction lowers balances for 2026–27 repayment calculations.

Fuel tax credits

Three different FTC rates applied from 1 July 2026 to 30 September 2026. Check the correct FTC rate was used for each 2025–26 period.

Instant asset write-off is now permanent

Claim eligible assets under the $20,000 threshold.

Payday Super transition

Confirm contributions made in the final weeks of June are correctly matched to the right financial year for deductibility.

STP reconciliation

Ensure your Single Touch Payroll data reconciles with your income tax return and PAYG withholding - the ATO cross-matches this routinely.

ATO - Tax Alert

If your agribusiness operation includes a distillery, craft brewery, or winery, the ATO has you on its radar. The ATO is cracking down on rorting of the alcohol manufacturers remission scheme - which allows producers to pay zero excise on the first $400,000 of alcohol produced annually.

If your operation includes a distillery, brewery, or winery, make sure your excise reporting and remission claims are in order. Speak to us if you have any questions.

Get Your Documents Sorted

Getting your tax return done quickly starts with having the right paperwork ready. Head to our Client Resources page for handy checklists covering everything we need from you so nothing gets missed and nothing holds up your return.

Deadline Dashboard

The Dates to Circle This Quarter

Date	What	Who
3 Aug 2026	Fuel excise returns to full indexed rate - update FTC calculations immediately	All businesses claiming FTCs
28 Aug 2026	TPAR due - contractor payments reported to the ATO	NSW construction & other industries
28 Oct 2026	Q1 2026-27 BAS due - first full Payday Super quarter	All quarterly BAS reporters
31 Oct 2026	Individual tax return deadline - self-lodgers only	Individuals lodging direct
Nov 2026	Certain Company, trust & partnership returns (via tax agent)	Certain entities & individuals
Dec 2026	Division 296 assessments expected - 2025-26 SMSF returns	Super balances above $3M

Not sure where to start?

Division 296, CGT reform, fuel credits, and tax returns - the Q3 changes touch nearly every client we work with. Let's map out what they mean for you.

Call 02 6362 1533 Email the Team

Frequently Asked Questions

What is a primary producer?+

According to the ATO, you are a primary producer if you run a business involving plant cultivation (growing crops, grains, flowers or fruit), animal maintenance (raising livestock for sale or produce like wool or milk), fisheries (commercial fishing or pearling), or forestry (planting or tending trees for felling). The keyword is business — you must show a clear intent to make a profit and have a significant scale of operation.

What is income averaging for primary producers?+

Income averaging is designed to ensure you don't pay more tax over time than someone on a steady salary. Normally a windfall in one year pushes you into the highest tax bracket, and if you earn nothing the next year you can't reclaim that high tax. Averaging rectifies this by looking at a rolling 5-year window.

How does income averaging work?+

The ATO calculates your average income over the current year and the previous four years, then compares your actual taxable income for the year against that average. If your current income is higher than your average, you get an averaging tax offset so you only pay tax at the rate applicable to your average income. If your current income is lower than your average, you may pay a little extra (known as complementary tax) to bring your tax up to the average rate.

What are the key rules for income averaging?+

Averaging doesn't kick in until your first year of primary production income is followed by a year where your income is equal to or higher than the first. If you have a side job, that non-primary income can sometimes be included in the averaging, but only up to a limit (usually $5,000–$10,000). You can choose to opt out of the averaging system permanently, but you can usually only get back in if your income drops significantly due to a permanent reduction, such as retiring from part of the business.

Who does Division 296 affect?+

Division 296 applies if your total superannuation balance (TSB) exceeds $3 million at 30 June. It applies to individual members, not the fund, and your TSB is the combined balance of all your super - whether self-managed, industry, retail, or other funds. A second threshold applies for balances over $10 million.

Does Division 296 tax unrealised gains?+

No - this was proposed in an earlier version of the tax but has since changed. Division 296 now only taxes capital gains once they are realised (i.e. when an asset is actually sold). SMSFs also have the option to 'opt in' to special relief allowing capital gains to be adjusted to reflect only growth since 30 June 2026.

When did the CGT and trust reform become law?+

The Treasury Laws Amendment (Tax Reform No. 1) Bill 2026 passed both houses of Parliament in late June 2026. However, most of the significant CGT changes - including the replacement of the 50% discount with cost base indexation - don't take effect until 1 July 2027.

Is the discretionary trust tax law yet?+

No - the proposed 30% minimum tax on discretionary trust distributions has not yet been introduced to Parliament. It remains a policy intent only, with a technical bill flagged for later in 2026 and a proposed effective date of 1 July 2028. Testamentary trusts are intended to be exempt, though this is not yet confirmed in law.

What fuel tax credit rate should I use right now?+

Fuel excise returned to the full indexed rate on 3 August 2026. If your business claims fuel tax credits, you need to apply two different rates across the Q1 2026-27 BAS period: the reduced rate for 1 July – 2 August, and the full restored rate from 3 August onwards. Check the ATO's published rates at ato.gov.au if you're unsure which applies to your vehicles or activities.

Is the Instant Asset Write-off still available?+

Yes - and it's now permanent. On 19 August 2026, the Instant Asset Write-off was locked in on an ongoing basis, up to a $20,000 threshold per asset. This removes the year-to-year uncertainty businesses previously faced around whether the concession would be extended.

ybm.com.au · 02 6362 1533 · mail@ybm.com.au · LinkedIn

This newsletter is general information only and does not constitute financial, tax or legal advice. Please speak with your YBM adviser about your specific circumstances before acting.

The dust settles — and there's still plenty to navigate