Capital Gains Tax (CGT).
Capital Gains Tax, commonly known as CGT, is the tax investors pay on the profit when selling an investment property that has increased in value. It’s not a separete tax necesarily but makes up part of an investors income tax.
If an investor sells a property more than they paid for it, the difference is the capital gain. In Australia, if an investor has owned the property for more than 12 months, they may be eligible for a 50% CGT discount. This means only half the gain is added to their taxable income (if eligible).
Generally speaking, a persons main residence is exempt from Capital Gains Tax, but investment properties are not.