Negatively Geared

A negatively geared property refers to when the costs of owning a property, like mortgage payments and maintenance, are higher than the rental income it generates.

What is negatively geared? 

A negatively geared property refers to when the costs of owning a property, like mortgage payments and maintenance, are higher than the rental income it generates. This means the owner is losing money each month and may need to cover the shortfall themselves. 

How is a negatively geared property different from a positively geared property? 

Put simply, a positively geared property earns more rental income than the expenses of owning it, so you make a profit each month. On the other hand, a negatively geared property earns less rental income than the expenses, so you make a loss each month.

What tax implications are there with negatively geared properties? 

The main advantage of having a negatively geared property is that it can potentially reduce your overall tax liability. 

When the expenses of owning the property exceed the rental income it generates, it creates a taxable loss. In other words, owning a negatively geared property can help reduce the total amount of tax you owe on your income. 

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