Negative gearing — where your property’s rental income is less than expenses, creating a tax loss — remains one of Australia’s most debated investment strategies.
How It Works
If your property costs $40K/year (mortgage, rates, maintenance) but earns $30K rent, the $10K loss reduces your taxable income. At a 37% marginal rate, that’s a $3,700 tax saving.
The CGT Discount
Hold 12+ months and you get a 50% capital gains discount. This is what makes negative gearing attractive long-term.
When It Doesn’t Make Sense
If the property doesn’t appreciate, you’re losing real money for a tax deduction. Cash flow negative properties need capital growth to justify the strategy.
Calculate Your Scenario
Use the Negative Gearing Calculator. Read the full guide. Check stamp duty costs too.
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