Updated 26 September 2026
A capital gains tax valuation establishes what a property was worth at a specific date, so the capital gain on a CGT event can be calculated correctly. The ATO expects an objective, evidence-based figure, not a real estate agent's appraisal. We prepare current and retrospective CGT valuations Australia-wide, from $297 inc. GST.
At a glance
A capital gains tax valuation is an independent assessment of a property's market value at a specific date, prepared so a capital gain or loss can be worked out for tax purposes. It can be a current valuation, dated today, or a retrospective valuation dated years or decades in the past. Either way, the report has to be defensible if the ATO reviews the return.
The valuation matters because a CGT calculation is only ever as reliable as the two numbers at each end of it. One is what you received on disposal. The other is your cost base. In a straightforward purchase and sale, both come from contracts. In every other situation, and there are many, one of those numbers has to be established by valuation.
That is the entire purpose of a CGT valuation: to put a supportable figure where a contract price does not exist, is not the relevant amount, or is not the arm's length amount.
These are the triggers we see most often, each tied to the provision that creates the requirement.
Section 118-192 ITAA 1997 resets the cost base of a former main residence to its market value on the day it first produced income. The reset applies where the first income use occurred after 20 August 1996, the dwelling was acquired on or after 20 September 1985, and a full main residence exemption would have applied had you sold just before that day. Where it applies, it is mandatory, not optional. Every dollar of growth while you lived there falls out of the CGT calculation, but only if you can support the value at that date. See our home to investment property valuation page.
Section 116-30 substitutes market value for the actual proceeds where a transfer happens for nothing, or where the parties did not deal at arm's length. Section 112-20 does the same on the acquiring side, so the person receiving the property takes a market value cost base. Transferring a property to an adult child for $1, or into a family trust at a friendly price, does not change the tax outcome. Both parties are assessed on market value, and market value has to come from somewhere defensible. More on our related party transfer page.
Death is not a CGT event. Under Division 128 the tax is deferred until the beneficiary or the estate disposes of the asset. For an asset the deceased acquired before 20 September 1985, and for a dwelling that was their main residence and not producing income just before death, the first element of the cost base becomes the market value at the date of death. That value usually has to be established retrospectively, sometimes many years later. See deceased estate valuations.
Property settlements need a market value, and often a value as at the date of separation rather than today. The valuation supports both the settlement itself and the CGT position of whoever ends up holding the asset. See family law valuations.
Pre-CGT status is not permanent. Division 149 can strip it where majority underlying ownership changes, and the enacted 2027 reform brings pre-CGT assets into the net for growth accruing after 1 July 2027. Both outcomes turn on a market value at a specific date.
The Treasury Laws Amendment (Tax Reform No. 1) Act 2026 treats affected CGT assets as disposed of and reacquired at market value on that date. This is covered in detail below and on the 1 July 2027 valuation page.
For advisers
The common file gapThe valuation is usually needed years before the return that uses it. Clients who converted a home to a rental in 2019 and sell in 2028 need a 2019 value, and the evidence for it thins with every year that passes. Identifying the trigger date at the time it happens is the cheapest intervention available. See how we work with accountants.
There is no register of ATO-approved valuers. What the ATO assesses is the quality of the process and the evidence, and it treats a valuation by a qualified professional valuer as more credible than an estimate from someone without those qualifications. That distinction matters when a figure is challenged.
| Source of the figure | What it actually is | Suitable for CGT? |
|---|---|---|
| Certified Property Valuer | Independent market value assessed against comparable sales, with documented method and reasoning | Yes |
| Real estate agent appraisal | A marketing estimate of likely selling price, usually undocumented and often deliberately optimistic | No |
| Bank valuation | A risk assessment for a lender, deliberately conservative, prepared for the bank rather than for you | No |
| Quantity surveyor report | Construction cost estimation for depreciation purposes, not an assessment of market value | No |
| Online estimate | An algorithm applied to today's market, with no reasoning and no ability to value a past date | No |
Our reports are prepared and signed by a Chartered Accountant who is also a Certified Property Valuer and a Registered Tax Agent. That combination matters in practice: the report is built by someone who understands the provision it is being prepared for, so the valuation date, the interest being valued and the assumptions all match what the return actually needs.
The ATO's guidance on market valuations for tax purposes sets out what it expects to see. A report that satisfies it will:
The full checklist is set out in what makes a valuation ATO-compliant. The underlying definition of market value comes from Spencer v Commonwealth (1907): the price a willing but not anxious buyer and a willing but not anxious seller would agree, both fully informed, with the property properly exposed to the market. Every element above exists to demonstrate that this standard was actually applied.
Penalty risk
What an unsupportable figure costsUnder section 284-90 of Schedule 1 to the Taxation Administration Act 1953, shortfall penalties run at 25 per cent of the shortfall for failure to take reasonable care, 50 per cent for recklessness and 75 per cent for intentional disregard. Interest applies on top, and general interest charge is not deductible from 1 July 2025. Engaging a professional valuer and giving them accurate instructions is what supports a reasonable care position.
For residential property and most straightforward commercial property, the primary method is direct comparison. Sales of genuinely comparable properties around the valuation date are analysed, then adjusted for the differences that matter: land area, building area, condition, aspect, position within the street, and the state of the market on the exact date.
Income-producing commercial property is more often assessed by capitalisation of net income, applying a market yield derived from comparable investment sales. Development sites can call for a hypothetical development approach, and specialised assets a summation or depreciated replacement cost method.
Whichever method applies, the adjustments and the reasoning are what make the number defensible. A figure with no working behind it is an opinion. A figure with sales evidence, adjustments and a stated method is a valuation.
Independent desktop reports prepared and signed by a Chartered Accountant and Certified Property Valuer. Current or retrospective, Australia-wide, delivered in 24 to 48 hours. Residential $297, commercial $595, AUD inc. GST.
Start your orderHow it worksThe gain is capital proceeds less cost base. The cost base has five elements under Division 110: the acquisition cost, incidental costs such as stamp duty, conveyancing and agent commission, ownership costs where they have not already been deducted, capital improvements, and costs of preserving title. Anything already claimed as a deduction cannot be counted again.
The valuation replaces one of those inputs. Either it becomes the first element of the cost base, as with a section 118-192 reset or an inherited pre-CGT asset, or it becomes the capital proceeds, as with a related party transfer under section 116-30.
Note
Worked exampleAn Adelaide home bought in 2012 for $520,000, with $22,000 stamp duty, $1,500 legal costs and a $60,000 extension. The owner moved interstate in 2018 and rented it out. It sells in 2026 for $940,000 with $24,700 of selling costs.
Without a valuation at the 2018 conversion date, the owner works from the original cost base: $520,000 plus $22,000 plus $1,500 plus $60,000 plus $24,700 equals $628,200. The gain is $311,800, halved by the 50 per cent discount to $155,900 assessable.
With a valuation showing $700,000 at the date it first earned income, section 118-192 resets the first element to $700,000. Cost base becomes $700,000 plus $24,700 equals $724,700. The gain is $215,300, halved to $107,650 assessable.
The difference is $48,250 of assessable gain. At a 37 per cent marginal rate plus the 2 per cent Medicare levy, that is roughly $18,800 of tax, against a $297 valuation fee.
The fee itself is not lost. A valuation obtained to work out a cost base element generally forms part of the cost base as an incidental cost, and where it is obtained in the course of managing your tax affairs it may instead be deductible. Your accountant will apply whichever treatment fits.
The Treasury Laws Amendment (Tax Reform No. 1) Act 2026 received Royal Assent on 26 June 2026. From 1 July 2027, for individuals, trusts and partnerships, the 50 per cent CGT discount is replaced by CPI cost base indexation together with a 30 per cent minimum tax on net capital gains. This is law, not a proposal.
The reform itself, and what it does and does not change, is set out in the guide to Australia’s CGT changes.
The transition is what creates valuation work. Affected assets are treated as disposed of and reacquired at market value on 1 July 2027, so the gain that accrued before that date is worked out under the old rules and the gain after it under the new ones. Owners can instead elect an apportioning method under subsections 112-155(3) and 112-165(3), which splits the gain by reference to time rather than actual value.
The CGT calculator for the 1 July 2027 rules shows what that choice is worth for every Australian market, by property type and by the year you bought.
Treasury released the apportioning formula as an exposure draft on 3 August 2026. Until it is, no one can model the two options precisely for a given property. What is already clear is that the apportionment formula assumes value compounded at one steady daily rate across the ownership period, and property rarely does. A property that ran hard early and flattened later, or that was renovated or rezoned at a particular point, will usually be better served by an actual valuation at the transition date.
Full detail is on the 1 July 2027 valuation page, and the two methods are compared in formula versus valuation.
| Report | Fee (AUD inc. GST) | Turnaround |
|---|---|---|
| Residential, current or retrospective | $297 | 24 to 48 hours |
| Commercial, current or retrospective | $595 | 24 to 48 hours |
A retrospective date costs the same as a current one. The fee is fixed and quoted before we start, so there is no hourly exposure and no variation once the scope is set. Complex or unusual assets are quoted individually before any work begins. For how this compares to the wider market, see what a CGT valuation costs.
More detail on the process page, or start an order now.
You need one wherever the CGT calculation depends on a market value rather than a contract price. The most common cases are converting a home to a rental, transferring property to a related party or trust, inheriting property, separating, and holding an asset across 1 July 2027. If both the purchase and sale prices are arm's length contract prices and no reset applies, you generally do not.
An agent appraisal is a marketing estimate rather than an assessment of market value, and it carries far less weight than a professional valuation. The ATO looks for objectivity, documented comparable sales and stated reasoning, which an appraisal does not provide. Using one where the figure is later challenged leaves you exposed to a shortfall and penalties.
Residential reports are $297 inc. GST and commercial reports are $595 inc. GST, fixed and quoted upfront, with delivery in 24 to 48 hours. Retrospective dates cost the same as current dates. Complex assets are quoted individually.
Yes. A retrospective valuation establishes market value as at a past date using sales evidence from that period, and it is a normal and accepted approach where a valuation was not obtained at the time. Values can be established for dates decades in the past, including before 20 September 1985, wherever the historical evidence supports it.
Fixed fee, 24 to 48 hours, Australia-wide. Prepared and signed by a Chartered Accountant and Certified Property Valuer.
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