Budget changes, borrowing power and property: what medical professionals should be thinking about now.
There’s been plenty of noise around the proposed budget changes, trusts, CGT, negative gearing, ownership structures, borrowing capacity. For doctors, dentists, vets and practice owners, this isn’t abstract policy. It shapes how you structure your business and investments, how you invest, how much you can borrow, and how you build long-term wealth.
The message is simple: don’t panic, don’t rush, but don’t ignore it either. Now is the right time to engage with your team of trusted advisors.
MedX Finance recently brought together specialists across accounting, lending, property and wealth planning to cut through the noise: what matters, what not to overreact to, and where a review may be needed. Here’s what came out of it.
1. The changes are significant, but most are still proposed
Tom Howard, Associate Director at Pilot Partners, put it plainly: unlike recent budgets, this one is substantial. Three areas matter most for medical professionals, because trusts, property and investment structures run through practice ownership, family wealth and asset protection.
Trusts. A proposed minimum tax rate (30%) on discretionary trust distributions will change how trusts have long been used in Australia and make some common strategies far less tax-effective. These changes aren’t set to begin until 1 July 2028, and the legislation hasn’t presented to Parliament yet. The Government is promising expanded CGT rollover relief to allow an easier migration to other structures.
Negative gearing. The proposed rules narrow eligibility for acquisitions of existing residential property post 12 May 2026, with losses on these properties to be quarantined and carried forward rather than offset against other income. Existing investments (at Budget night) are set to be grandfathered. Negative gearing (as we know it) remains available for acquisitions of new residential property, as well as other assets such as commercial property.
Capital gains tax. Phasing out the 50% CGT discount in favour of cost base indexation could materially change outcomes depending on the asset, cost base and holding period. For some, cost base indexation will be less favourable than today’s CGT discount.
The critical point: these are proposals, not law (yet). Details may shift. So, this isn’t the moment to panic or unwind structures but it is the moment to understand your exposure and discuss how this Budget impacts you.
2. Your borrowing capacity may already have changed
Tax changes may be years away. The lending market isn’t waiting.
Jack Meagher, Senior Partner at MedX Finance, notes lenders are already adjusting serviceability models, especially around negative gearing on established residential property. And the changes aren’t uniform: every lender is moving at a different pace, in a different way.
That means two medical professionals with identical income, deposit and strategy can get very different outcomes depending on the lender. One client held an investment pre-approval before budget night; reworked under new lender policy, their borrowing capacity had dropped around 20%.
So don’t assume your existing pre-approval still reflects where you stand. If you’re buying, investing, upgrading, refinancing or acquiring a practice, your position needs reviewing under today’s settings, where lender selection and scenario modelling do the heavy lifting.
Historically, many doctors default back to the incumbent bank. In this environment, that’s limiting. Medical professionals are usually viewed as lower-risk clients, valuable standing, but only when it’s positioned well and matched to the right lender policy. The opportunity is still there but the sequencing and leg work to find the right policy matters.
3. Structure matters more than ever
Many medical professionals hold assets through family trusts, companies or SMSFs and run practices through complex entities. The proposed changes make structure a bigger conversation, not a reason to rush.
A trust isn’t automatically wrong. Holding property personally doesn’t automatically mean restructure. An SMSF isn’t automatically the right home for every future asset. What it does mean: your structures should be reviewed in context; income, assets, borrowing plans, practice goals, family position, tax, risk profile, time horizon and future strategy.
Get it wrong and you create unnecessary tax, lending or cash flow consequences. Get it right and you protect flexibility and improve long-term outcomes. These decisions are connected; looking at one in isolation creates problems elsewhere, you need to lean on your team of advisors more than ever.
4. New builds may become more attractive, but fundamentals still matter
Scott Guilford from The Property Team made the long-view point: investors have seen cycles before. Markets rise and fall, rates move, rules change. The question is never “what changed this week?” it’s “what’s the long-term plan, and how do we adapt?”
The proposed negative gearing rules may push demand toward new residential property, widening the gap between new and established on both tax and cash flow. New builds can offer more favourable treatment under the proposed rules, stronger rental appeal, greater depreciation, lower maintenance, better cash flow resilience, and equity from day one with the right purchase.
But not every new build is a good investment. Asset quality, location, supply and demand, rental yield and cash flow still decide the outcome. Investors who get into trouble usually do so through cash flow, so the real question isn’t only “will this grow?” but “can I hold it comfortably through changing markets, rates and rules?”
5. Budgets don’t build wealth. Action does.
Joanne Tinetti, Senior Financial Advisor at Perpetual Private, brought it back to a principle: every strategy carries legislative risk. A strategy that works under one set of rules can weaken when governments change them. You can’t remove that risk but you can reduce overexposure through diversification across cash, shares, property, super and business assets, mixed to suit your circumstances and time horizon.
The trap is sitting on the sidelines waiting for certainty that rarely comes. A budget doesn’t build wealth. Action does. Informed, deliberate and co-ordinated.
6. Don’t miss the 30 June window
While most proposed changes are years away, this tax year still counts. Joanne’s most practical point: the weeks before 30 June create real planning opportunities; super contributions, contribution caps, spouse contributions, income splitting, deductions and business expenses. Miss the window and you can’t always go back and fix it.
What should medical professionals do next?
Not panic. Not wait and hope. Review. Start with five questions:
Are my current structures still appropriate? If you use trusts, companies or SMSFs, get advice on how the proposals affect you from trusted professionals.
Has my borrowing capacity changed? Don’t assume your old pre-approval numbers still apply.
Am I with the right lender? Policy differences now materially change your options.
Does my property strategy still make sense? Established property, new builds, commercial, SMSF borrowing and home upgrades may all need rethinking.
What can I still do before 30 June? Super and tax planning may need attention now, not later.
The bottom line
There’s a lot changing but uncertainty isn’t a reason for inaction. The opportunity for medical professionals is to get organised, get clear on the numbers, and decide with the right advice around you.
The proposals may touch trusts, property, CGT, borrowing capacity and long-term wealth. They don’t change the fundamentals: good structure, strong cash flow, quality assets, the right lender, a long-term plan and action.
As a specialist medical finance broker, MedX Finance works with medical professionals every day to make sense of their lending options, structure their finance and access the right lender solutions across personal, practice and investment goals.
If you’re unsure how the proposed changes affect your borrowing position or your next move, now’s the time to review your options. Not to panic. To plan. Speak to a trusted advisor today:
Tom Howard – Pilot Partners
Jack Meagher – MedX Finance
Scott Guildford – The Property Team
Joanne Tinetti - Perpetual Private
This article is general information only and doesn’t take your personal circumstances into account. It isn’t financial, tax or legal advice. Speak with your qualified advisers before acting.