Married? Five tax rules you need to know before lodging

Getting married changes more than your surname.

It can affect your tax return, Medicare levy surcharge, government benefits and even how much capital gains tax you pay when selling property. Here are the key tax rules couples should know before lodging this year.

How does marriage affect your tax return?

Four marriage tax rules that could affect your refund

Lodge your tax return separately from your spouse

You don't have to lodge a combined tax return if you're married (as happens in some other countries).

Joint income is recorded separately in each spouse's tax return.

Disclose your spouse and their income 

You need to show on your tax return that you now have a spouse, and disclose his or her taxable income each year.

Prepare for your combined income to be assessed

Your combined income is used to assess whether you pay the Medicare levy surcharge.

For 2025-26, couples earning more than $202,000 without eligible private hospital cover may pay an extra 1% to 1.5% in tax, and it can also affect eligibility for some benefits such as family tax benefits.

Notify the ATO of your new name

If you elect to change your name, the details will need to be updated before your tax return is lodged.

The easiest way to do that is online or you can do it by phone. You'll need to verify your identity with the ATO when you do it, so you'll need documents such as your birth certificate or marriage certificate.

You cannot notify the tax office simply by noting it on the front cover of your next return as used to be the case.

The costly CGT rule many couples don't know about

For homeowners, the biggest tax surprise often comes when both partners own property.

Many couples don't realise getting married or entering a de facto relationship can affect their capital gains tax position.

Normally, you can sell your main residence without CGT.

However, spouses are only entitled to one CGT main residence exemption between them. (This applies once you're treated as spouses for tax purposes, not just legally married.)

If both members of a couple each own a main residence they must either:

• select one residence for the exemption
• apportion the CGT exemption between the two residences.

Provided the homes meet the requirements for the main residence exemption, they will both be wholly exempt from CGT for the period prior to the couple being treated as spouses.

In some cases, the exemption can be split between both properties, but this can reduce how much of the gain is tax-free.

How the CGT rule works in practice

Susan bought a house in 2004.

She lived in it until she married Roger in 2020 at which point they moved into his house, which he had owned since 2010.

Roger's house became their main residence for CGT purposes.

If she chooses to sell her house, Susan will be subject to CGT on her house for any growth in value from 2020 but she will not have to pay CGT on any capital growth in the period before she married Roger.

Can wedding gifts be tax-deductible?

For most couples, property and Medicare levy rules have a much bigger financial impact than wedding gifts.

If your guests choose to make gifts to a charity of your choice as a wedding gift, they can claim a tax deduction for the gift provided it's to a charity registered as a Deductible Gift Recipient.

Tax rules for married, de facto and same-sex couples

The definition of spouse includes both de facto relationships and registered relationships.

Your spouse is another person (whether of the same sex or opposite sex) who:

• is in a relationship with you and is registered under a prescribed state or territory law
• although not legally married to you, lives with you on a genuine domestic basis in a relationship as a couple.

That means that people living in same-sex relationships are now treated in the same way as heterosexual couples for tax purposes.

They now fall under the same rules in areas such as these:

• Medicare levy reduction or exemption
• Medicare levy surcharge
• Main residence exemption for capital gains tax.

Get stories like this in our newsletters.