The most consequential federal Budget for Allied Health in more than a decade landed on 12 May 2026. It delivers structural changes to tax, DVA funding, and aged care that will reshape how Allied Health practices are owned, operated, and grown for years to come.

Here's what you need to know.

• Tax changes that affect you personally and as a practice owner; income tax cuts, FBT changes on EVs, and the most significant reforms to CGT and discretionary trusts in a generation.
• NDIS: a clear reset timeline. From mandatory registration to Thriving Kids to the new framework planning rollout, the reform schedule is now locked in.
• DVA: a fee uplift and a simpler model: up to 45.6% fee increase from 1 July 2027 for Allied Health, with treatment cycles replaced by an annual monetary limit.
• Support at Home: more packages - but key questions on pricing and CHSP continuity remain unanswered.
• What it means for your practice, and how splose helps you stay efficient through the transition.

On 12 May 2026, Treasurer Jim Chalmers delivered the 2026–27 federal Budget, the most consequential Budget for Allied Health business owners in more than a decade. Beyond the headline NDIS reforms previewed at Minister Butler's Press Club address in April, the Budget delivers structural tax reform that touches almost every aspect of how Allied Health practices are owned, structured, and operated, alongside material changes to DVA fees, Support at Home expansion, and the funding mechanics for the NDIS reset.

For Allied Health business owners, the Budget needs to be read on two levels: as an employer, where personal income tax cuts and FBT changes on electric vehicles directly affect remuneration and fleet decisions; and as an owner of a practice and often property, where the most significant changes to capital gains tax, negative gearing, and the taxation of discretionary trusts in a generation will reshape the way Allied Health businesses are structured for the next decade.

This article walks through each of the changes most relevant to Allied Health businesses and where the operational decisions sit.

The Government has added a third round of tax relief on top of cuts already legislated. The 16 per cent rate on income between $18,201 and $45,000 drops to 15 per cent from 1 July 2026 and to 14 per cent from 1 July 2027. These flow automatically through PAYG, so make sure your payroll software is current. From the 2027–28 income year, a new Working Australians Tax Offset (WATO) provides up to $250 per worker, paid through the tax return. 

The FBT exemption for electric vehicles is being stepped down to a permanent lower setting through three windows:

• Until 1 April 2027: EVs at or below the fuel-efficient LCT threshold receive a 100 per cent FBT exemption.
• 1 April 2027 to 1 April 2029: EVs at or below $75,000 retain the 100 per cent exemption; EVs above $75,000 and up to the fuel-efficient LCT threshold step down to a 25 per cent FBT discount.
• From 1 April 2029: all new arrangements step down to the permanent 25 per cent FBT discount.

Critically, arrangements commenced in one window retain that window's treatment for the life of the arrangement. For practices or staff considering an EV through a novated lease or as a tool of trade, commencing the arrangement before 1 April 2029 — and ideally before 1 April 2027 for higher-value vehicles — locks in the more generous treatment. Existing EV arrangements are grandfathered.

From 1 July 2027, the 50 per cent CGT discount available to individuals, trusts, and partnerships is replaced by cost base indexation paired with a 30 per cent minimum tax on net capital gains. Gains arising before 1 July 2027 are unaffected. The main residence exemption and super arrangements are unchanged, and the small business CGT concessions remain in place. Investors in new residential property can elect either method.

Negative gearing is narrowed at the same date: losses on established residential properties will only be deductible against rental income or capital gains from residential property, with excess losses carried forward. New builds, properties in widely held trusts, super funds, and build-to-rent are exempt.

For Allied Health owners, the CGT changes carry through to virtually every long-held asset on the personal or family balance sheet — clinic premises, investment property, portfolio assets, practice goodwill held outside the small business concessions. The 14 months between announcement and 1 July 2027 is the planning window. For assets with substantial unrealised gains held over long periods, indexation can produce similar or better outcomes than the 50 per cent discount. For shorter-held assets with rapid growth, the loss of the discount is material. The answer is asset-by-asset and owner-by-owner — and worth modelling early with your accountant.

From 1 July 2028, trustees of discretionary trusts will pay a minimum 30 per cent tax on trust taxable income. Beneficiaries receive non-refundable credits for the trust-paid tax. Where a beneficiary's marginal rate is below 30 per cent, the credit cannot be refunded — the trust's tax becomes the floor. Fixed trusts, complying super funds, special disability trusts, deceased estates, and charitable trusts are excluded. To support transition, a three-year rollover from 1 July 2027 lets small businesses restructure out of discretionary trusts into a company or fixed trust without triggering CGT.

For Allied Health owners, the benefits of income-splitting to lower-income family members are significantly diminished. Restructuring to a company or fixed trust becomes a live consideration for many practices, with a structured window to do it cleanly. Asset protection considerations are unchanged.

The $20,000 instant asset write-off becomes permanent from 1 July 2026 for small businesses with aggregated turnover up to $10 million. This removes the recurring planning ambiguity around capital purchases under $20,000 per item are now permanently deductible in the year they are first used or installed.

Two related measures sit alongside the IAWO: a 2 year loss carry-back is reintroduced and made permanent for companies with global turnover under $1 billion from tax years from 1 July 2026, providing a cash flow recovery mechanism for incorporated practices that experience a loss year. Loss refundability for small start-ups from 1 July 2028 provides a refundable tax offset on losses for genuinely new businesses with turnover under $10 million in their first two years.

The Budget includes $169.7 million over five years (and $58.8 million per year ongoing) to increase allied health provider fees for Veteran Card holders from 1 July 2027. This responds to Recommendation 71 of the Royal Commission into Defence and Veteran Suicide. 

The fee increase is paired with a structural change to how DVA allied health is accessed. From 1 July 2027, the treatment cycle approach is removed and replaced with a $5,000 Annual Monetary Limit for veterans' allied health services, extendable where clinically indicated. For practices delivering DVA services, this is a meaningful shift in workflow: the recurring administrative overhead of treatment cycle initial consultations, patient care plans, and end-of-cycle reports is reduced, and ongoing care is governed by an annual cap rather than a per-cycle session limit.

For practices with a significant DVA caseload, the period between now and 1 July 2027 is the planning window to model the revenue impact, review pricing of mixed-funded clients, and prepare clinical and administrative workflows for the new arrangements.

In splose, the cases feature is able to support practices to monitor budget utilisation and end dates with automated alerts triggered based on utilisation or time before the end date.

The NDIS measures in this Budget are the funding mechanics for the structural reset Minister Butler announced in April. The Government will provide $1.7 billion over five years under the Securing the National Disability Insurance Scheme for Future Generations measure. NDIA payments are projected to fall by $37.8 billion over four years from 2026–27 relative to the Actuary's updated projections. The NDIS will continue to grow each year but at a sharply reduced trajectory.

The measure funds the operational backbone — a new enrolment and digital payment system ($358.5m), the Fraud Fusion Taskforce and NDIA fraud capability ($280.1m), new framework planning rollout preparation ($270.1m in 2026–27), mandatory registration of higher-risk providers ($182.6m, partially cost-recovered), commissioned plan management and support coordination ($49.4m), regulatory activity by the Quality and Safeguards Commission ($21.7m), Disability Representative Organisations ($15.9m), and an extended NDIS Appeals program ($14.7m).

Alongside the Budget, the Department of Health, Disability and Ageing released a detailed implementation timeline. Key dates for Allied Health providers:

• Mid-May 2026: NDIS Amendment (Securing the NDIS for Future Generations) Bill introduced to Parliament.
• 7 days after Royal Assent: Tighter criteria for unscheduled plan reassessments; new record-retention requirements for participants and providers; stronger NDIA compliance, enforcement, and information-gathering powers; the Minister becomes the decision-maker on NDIS pricing.
• Mid-June 2026: Technical Advisory Group established to design the new functional capacity eligibility process.
• 1 July 2026: Mandatory registration begins for Supported Independent Living and platform providers. Consultation begins on expanding differentiated pricing for unregistered providers, design of the Inclusive Communities Fund, commissioning of SIL home-and-living supports, and market reforms for social and community participation and capacity building activities.
• August–October 2026: Consultations on new framework planning rules, the new eligibility process, differentiated pricing, the Inclusive Communities Fund, and SIL commissioning progressively conclude.
• 1 October 2026: Phased rollout of Thriving Kids begins for children aged 8 and under with developmental delay and/or autism with low to moderate support needs. Participant support budgets for social, civic, and community participation and capacity building daily activities are progressively reset as plans are reassessed or renewed.
• 1 February 2027: No carryover of unspent funds — as plans reach scheduled reassessment, renewed plans are created and unspent funds from the previous plan are not carried over. Tighter assessment of reasonable and necessary supports begins for new entrants, progressively applied to current participants on reassessment.
• 1 April 2027: Participants begin transitioning to new framework planning.
• 1 July 2027: Expanded mandatory registration begins for higher-risk activities (personal care, daily living supports, supports in closed settings), with all in-scope providers to be registered by December 2030. Rollout of the new enrolment system begins, with all in-scope providers to be enrolled by December 2027.
• 1 October 2027: New panel of plan management providers begins, with a six-month transition.
• 1 January 2028: Access changes for new applicants based on standardised, evidence-based functional capacity assessment. Thriving Kids fully operational nationally. Existing participants reassessed over two years.
• 1 July 2028: New commissioned support coordination and connection function begins.
• 31 December 2030: All participants transitioned to new framework plans.

Thriving Kids — NSW model now visible. The NSW Department of Communities and Justice opened its Thriving Kids EOI this week, with services to commence from October 2026. NSW has confirmed the program will be delivered primarily by Not-For-Profit providers; private providers can submit an EOI but will only be considered "in exceptional circumstances where services aren't available from NFPs." For private paediatric practices in NSW, this materially constrains the pathway into Thriving Kids: the practical options are subcontracting from a commissioned NFP where workforce coverage requires it, or applying directly in thin-market situations. Other states and territories may take a different approach with their procurement positions yet to be released at the time of writing.

Awaiting the 2026–27 NDIS PAPL. Providers are eagerly waiting for the 2026–27 NDIS Pricing Arrangements and Price Limits. With the Minister now the formal decision-maker on pricing the PAPL release will be the first concrete read on pricing direction for the new reform cycle.

The Budget delivers a $1.4 billion expansion of Support at Home over four years with part of this being an expansion of “packages”.

The accelerated release of Support at Home packages is the most operationally significant item. Constrained package numbers have been one of the central demand-side risks through the transition; more packages means more eligible participants on packages sooner, which directly affects allied health demand.

Outstanding questions. Providers are still waiting on two key pieces of information that the Budget did not resolve:

1. When capped prices will roll out, and at what level. The price caps for Support at Home services have been signalled but not confirmed in either timing or level. For practices building 2026–27 fee schedules and clinician utilisation targets, this is the missing input.
2. Whether CHSP will continue past 1 July 2027. The original Support at Home transition design contemplated CHSP folding into Support at Home, but the timeline is slipping and many CHSP providers are now operating without clarity on whether their current grant arrangements continue, transition, or end. The aged care sector is awaiting a clear answer.

The combined effect of these reforms — decreased NDIS growth, Support at Home capped pricing, new budget rules for DVA, and structural changes to practice tax structures — is a period in which operational efficiency is no longer optional. splose is built to support practice efficiency with advanced automations and AI:

• Embeddable referral forms create the client record at the point of intake, reducing manual data entry.
• Service agreements are issued, signed, and stored against the participant record.
• AI notes support transcription or dictation of sessions so practitioners can spend less time on non-billable documentation to support utilisation.
• Batch invoicing saves hours per week and ensures that back of office costs remain constrained.
• NDIS bulk upload with PACE maintains cash flow as the new enrolment and digital payment system tightens claim review and evidence requirements.
• Case management with funding period splitting tracks allocated budget, appointments or hours and blocks overspend.

This Budget is unusually demanding on Allied Health business owners because the decisions it forces are not operational - they are structural. The NDIS, DVA, and Support at Home funding mechanics will roll through clinical practice over 2026, 2027, and 2028 with growth constraints expected.

The next operational milestones to watch for are the release of the 2026–27 NDIS Pricing Arrangements and Price Limits and the confirmation on when Support at Home capped pricing will be implemented.

Allied Health business owners should discuss the outcomes of the budget and upcoming price guides with their accountant or tax advisor to inform their strategic and operational planning.

About the author: Scott Lynch is the Founder and Managing Director of Community Therapy, a leading multi-disciplinary Allied Health practice. Physiotherapist by background, Scott combines his deep clinical knowledge with a passion for community-based care, overseeing a diverse team of health professionals dedicated to supporting and empowering their clients to live enriched lives.

This article is general commentary on the 2026–27 federal Budget and is not tax, legal, or financial advice. Allied Health business owners should consult their accountant, tax adviser, or lawyer before making structural or transactional decisions on the basis of the measures discussed.