The ATO says do not get your July 2027 valuation yet. What to keep instead

On 19 October 2026 the ATO told tax professionals that nobody needs a valuation in place on 1 July 2027, and that nobody should get one before then. That answers a question some owners have been asking since the first stage of the capital gains changes became law in June: whether to book a valuer now. The tax office says no.

What you can do now is cheaper. Keep the evidence a valuer will need afterwards, and plan to capture the business as it stands on the day.

This updates the earlier piece on the tax value every business gets on 1 July 2027, which explains the deemed sale and why the figure matters, and the piece on the 2027 changes covers the rest of the new rules. I will not repeat either here.

What the ATO said

The guidance went up in the ATO's tax professionals newsroom on 19 October. Four points in it matter to a business owner.

No valuation is needed on the date. Taxpayers may need to work out the market value of an asset immediately before 1 July 2027. The ATO says this does not require a valuation to be in place on that date.

Do not get one early. The ATO's reason is short. A valuation cannot look forward, so it says taxpayers should not obtain one before the date. A figure prepared in May 2027 is a forecast of what the business will be worth in July. A valuation done after the date can look at the business as it actually stood.

Market value is the default. The ATO says the market value is used as the capital proceeds for the deemed sale and as the first element of the cost base for the gain after it. The Act says the same thing. Unless you choose the alternative, the proceeds are the asset's market value just before 1 July 2027.

The alternative is not finished. The ATO calls it the apportionment method. The Act lets the Minister set an apportioning method by legislative instrument under section 112-185. The ATO says the Government is currently developing it and that guidance will follow once it has been enacted. Until it exists, nobody can tell you whether it will suit your assets.

One part of the Act takes the pressure off that choice. You do not have to choose between market value and the method until you lodge your tax return for the income year in which you actually sell, or in which another realisation event happens.

Pre CGT assets, including a company's

A company's own ordinary assets are not revalued. The deemed sale in section 112-155 covers resident individuals and the one in section 112-165 covers trusts.

Pre CGT assets work differently. The ATO describes them as assets acquired before 20 September 1985. Section 112-175 applies to an asset that is pre CGT on 30 June 2027, and unlike the other two sections it is not limited to individuals or trusts. A company that has held premises, a business or shares since before September 1985 can be caught as well, provided the asset still counts as pre CGT on 30 June 2027. A change in the company's majority ownership since then can end that status, which is a question for your accountant.

For those assets the date matters more, not less. The asset is taken to be sold just before 1 July 2027 and bought back at market value. It stops being a pre CGT asset and its cost base is reset. The ATO's summary is that the changes will subject those with pre CGT assets to CGT for gains accruing on or after 1 July 2027.

So the figure at 1 July 2027 becomes the base that every later gain on that asset is measured from. If your family business, or the company that owns its premises, goes back that far, take it to your registered tax agent now rather than in 2027.

What to keep now instead

The ATO's existing guidance on market valuation says you need a valuation report or other records that show the valuation is objective, accurate and supported by evidence. Its 19 October update said more guidance is coming on the documentation and records required, on how to value certain types of assets, and on the types of professionals to consider.

Until that arrives, the safe course is to keep what any valuer will ask for, and to record the business as it stands on 30 June 2027 while the facts are fresh.

The standing file

• Lodged returns and financial statements for 2024-25 and 2025-26, and the 2026-27 accounts once they are finalised, reconciled to the bank.
• Every adjustment you make to earnings, each with a document behind it.
• Revenue by customer, the contracts and their renewal dates.
• The lease, the licences and the asset register.

The snapshot on 30 June 2027

• A stocktake on the day, at cost.
• The plant list with condition, hours or kilometres, and dated photos.
• Debtors and creditors aged as at 30 June.
• Staff, roles and key people as at that date.
• Any offer, approach or appraisal received around the date, with its date on it.

None of that costs a valuer's fee. A valuer working in late 2027 from a stocktake taken on the day is working from evidence. One working from what the owner remembers is working from estimates.

Both sides of it

The ATO's case. A valuation is an opinion of value at a date. One done before the date has to guess at the trading between the report and the date, so the tax office is telling taxpayers not to pay for a guess.

The profession's concern. Waiting puts every valuation after the same date. CPA Australia warned in June, before the Act passed, that without clear rules and guidance there would be bottlenecks, delays and increased compliance costs. The ATO's own list of guidance still to come is the clearest sign of how much is unsettled.

Both points stand. The answer to the second one is not to value early. It is to have the file ready, so that whoever does the work after the date spends their time on judgement and not on reconstruction.

Where a broker fits, and where one does not

I will not value your business for tax, and a broker's market appraisal is not a tax valuation. I am not a registered valuer or a tax agent. The ATO's own guidance is that valuations by professional valuers are more credible than those from someone who is not one.

Where I can help is the file. The records a valuer will want are the same ones a buyer's accountant and lender test before a sale, and the free readiness check runs through twelve of them. It runs in your browser, stores nothing and asks for no email.

What to do

• Do not book a valuation of your 1 July 2027 market value before that date. The ATO has said not to. A valuation needed for something else before then, such as a sale, is a separate question for your registered tax agent.
• Ask your registered tax agent which of your assets are caught, and whether anything you or your company holds was acquired before 20 September 1985.
• Start the standing file now, and put the 30 June 2027 snapshot in the diary.
• Wait for the rest of the guidance before choosing between market value and the apportioning method. The Act gives you until the return for the year you sell.