Is there a ‘secret death tax’ hidden in Labor’s CGT changes?

August 12, 2026 — 5:01am

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Can I check a recent answer you gave about the CGT impact on inherited shares after July 1, 2027? My understanding is that a death after July 1, 2027 changes how CGT is calculated before and after death, but it does not create an immediate CGT liability for either the estate or the beneficiary. The beneficiary can still inherit the shares in specie and only pay CGT if and when they eventually sell them.

However, your answer appeared to say the opposite – that the recent changes rushed through Parliament mean a death after July 1, 2027 creates an immediate CGT liability in the estate before the shares can be passed to the beneficiary. You are the only commentator I have found, whether a real adviser or an AI one, who has taken that view, and I would have expected far more public outcry if this really amounted to a secret death tax. I can only hope I have misunderstood your answer or, heaven forbid, that you are wrong. Perhaps the piece was written before the government walked back its proposal on unrealised capital gains.

I went back to tax expert Julia Hartman of BAN TACS, who confirms that what I wrote is correct under the legislation as it stands. On August 4, 2026, the Government released draft legislation containing proposed corrections, but unfortunately none of them resolves this particular problem.

There are, however, some cryptic remarks in the explanatory memorandum acknowledging problems with rollovers and indicating that they may be dealt with in future amendments. At least that suggests the government is now aware of the issue.

The reason it has received so little media attention is that the legislation is extraordinarily technical, which makes it even more important to keep the issue in the spotlight and put pressure on the government to fix it. It is astonishing that such an important defect was not corrected in this latest round of amendments.

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