Negative Gearing Explained for Australian Property Investors

Negative gearing occurs when the costs of owning a rental property exceed the income it generates. This loss can be offset against other income, reducing your overall tax liability. For Australian property investors, understanding negative gearing is essential for effective tax planning.

Key considerations include:

- Deductible expenses such as interest payments, repairs, and depreciation

- The impact on your marginal tax rate

- Capital gains implications when you eventually sell

- Record-keeping requirements for the ATO

It is important to keep detailed records and work with a registered tax agent to maximise your deductions while remaining compliant with ATO regulations.