Negative Gearing Calculator
Understand how negative gearing works and calculate the tax benefit for your investment property.
What is negative gearing?
Negative gearing occurs when the costs of owning an investment property (mortgage interest, expenses, depreciation) exceed the rental income it generates. The resulting loss can be offset against your other income — such as your salary — reducing the amount of tax you pay.
How the tax benefit works
If your investment property makes a $10,000 annual loss and your marginal tax rate is 37%, you receive a $3,700 tax benefit — effectively reducing your out-of-pocket cost by that amount. The higher your marginal rate, the larger the benefit.
Proposed reforms
There have been proposals to limit negative gearing to new properties only, or to cap the deductions available. Our calculator lets you toggle these reform scenarios on and off to see exactly how they would affect your investment returns.
Disclaimer: This calculator provides estimates only based on published ATO rates for the 2024-25 and 2025-26 financial years. It does not constitute financial or tax advice. Reform scenarios are modelled on publicly discussed proposals and may not reflect final legislation. Consult a qualified professional before making investment decisions.