Important Tax & Super Updates: What You Need to Know

The tax and superannuation landscape continues to evolve, and staying informed can help you make better financial decisions while avoiding unexpected surprises.

We highlight three important developments that may affect business owners, family trusts and Self-Managed Super Funds (SMSFs). Whether you’re planning for the future, reviewing your current structure or considering a major purchase, these changes are worth understanding.

1. Greater Clarity for Trusts
There has been welcome news for many business owners and families who use discretionary trusts.
In a landmark High Court decision, the Court rejected the ATO’s long-held view that unpaid trust distributions (known as unpaid present entitlements or UPEs) owed to corporate beneficiaries should automatically be treated as loans under Division 7A.

Why does this matter?
Previously, many business groups were required to enter into formal loan agreements, make annual repayments and meet ongoing compliance obligations to avoid adverse tax outcomes. The High Court’s decision provides greater certainty for many trust structures and may reduce the administrative burden associated with these arrangements.

While this is certainly positive news, it’s important to remember that other anti-avoidance provisions, including Division 7A and Section 100A, may still apply depending on your circumstances. Existing loan agreements also remain in place and cannot simply be unwound because of the Court’s decision.

If your current structure utilises both a company and a discretionary trust, now is an excellent opportunity to ensure it remains appropriate for your long-term objectives.

2. Updated Business Vehicle Thresholds
If you’re considering purchasing or leasing a business vehicle this financial year, several important tax thresholds changed from 1 July 2026.

Key changes include:
• Updated depreciation limits that may affect the amount you can claim.
• Higher GST credit caps for eligible business vehicles.
• Revised Luxury Car Tax (LCT) thresholds, including higher thresholds for many fuel-efficient vehicles.

These changes can have a significant impact on the overall after-tax cost of purchasing a vehicle. Rather than focusing solely on the purchase price, it’s worth considering depreciation, GST credits, LCT and your expected business use before making a decision.

If you’re planning to upgrade your business vehicle, speaking with your adviser before signing a contract could help you maximise available tax concessions.

3. SMSF Borrowing Rules Have Changed
Recent legislative changes have introduced new restrictions on borrowing through Self-Managed Super Funds (SMSFs). These changes primarily affect trustees looking to purchase property using a Limited Recourse Borrowing Arrangement (LRBA).

Under the new rules:
• Borrowing is generally limited to business real property.
• Transitional arrangements may apply to some existing transactions.
• Existing borrowing arrangements can continue, subject to the new legislation.

If you’re currently considering purchasing property through your SMSF—or have an acquisition already underway—it’s important to understand how these changes may affect your plans before proceeding.

Seeking advice early can help ensure your strategy remains compliant and aligned with your long-term retirement goals.

Need Advice?
Tax and superannuation rules are constantly changing, and every client’s circumstances are different.
Whether you’re reviewing your trust structure, planning to purchase a business vehicle or considering an investment through your SMSF, our experienced team can help you understand how these changes apply to your situation and identify the best way forward.

If you’d like to discuss any of these updates, please contact info@shakes.com.au or Phone (08) 9321 2111.