Negative Gearing
Comparison

Negative gearing happens when the costs of owning a rental property — loan interest, rates, insurance, management fees and repairs — add up to more than the rent you collect. That shortfall is a loss, and the ATO lets you deduct it from your other taxable income, which lowers your tax bill. The higher your marginal tax rate, the bigger that tax saving. It doesn't make the property profitable on its own — you're still out of pocket each week — but it does reduce the after-tax cost of holding it while you wait for the property to grow in value. Enter your numbers below to see the loss, the tax saving, and what it actually costs you week to week.

Deductible expenses include interest, rates, insurance, PM fees, repairs and strata. Depreciation not included. Tax calculated using ATO 2024–25 resident rates including Medicare levy. Not financial advice.