If you acquired a dwelling before 20 September 1985 (pre-CGT) and you make major capital improvements after that date, part of any capital gain you make when a capital gains tax event happens to the dwelling could be taxable.
Certain improvements to pre-CGT assets will be deemed to be separate post-CGT assets when the cost base of the improvement exceeds both the improvement threshold for the year the CGT event happens and 5% of the capital proceeds from the event.
Below are the Capital Gains Tax Improvement Thresholds for each financial year:
| Income Year | Threshold |
|---|---|
| 1985–86 | $50,000 |
| 1986–87 | $53,950 |
| 1987–88 | $58,859 |
| 1988–89 | $63,450 |
| 1989–90 | $68,018 |
| 1990–91 | $73,459 |
| 1991–92 | $78,160 |
| 1992–93 | $80,036 |
| 1993–94 | $80,756 |
| 1994–95 | $82,290 |
| 1995–96 | $84,347 |
| 1996–97 | $88,227 |
| 1997–98 | $89,992 |
| 1998–99 | $89,992 |
| 1999–2000 | $91,072 |
| 2000–01 | $92,802 |
| 2001–02 | $97,721 |
| 2002–03 | $101,239 |
| 2003–04 | $104,377 |
| 2004–05 | $106,882 |
| 2005–06 | $109,447 |
| 2006–07 | $112,512 |
| 2007–08 | $116,337 |
| 2008–09 | $119,594 |
| 2009–10 | $124,258 |
| 2010–11 | $126,619 |
| 2011–12 | $130,418 |
| 2012-13 | $134,200 |
| 2013-14 | $136,884 |
| 2014-15 | $140,443 |
