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Negative gearing calculator

Model your rental property's cash flow, and how a surplus or shortfall affects your tax.

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Law — grandfathering from 12 May 2026, loss quarantining from 1 July 2027 (Treasury Laws Amendment (Tax Reform No. 1) Act 2026): this property's rental loss can only offset rental income or residential capital gains, not your other income.

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$
$
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Marginal rate
$

Annual shortfall

$10,000

Tax saved: $3,000

  1. 1

    Calculated total deductions

    Loan interest ($25,000) + other expenses ($6,000) + depreciation ($5,000).

    $36,000.00

  2. 2

    Property is negatively geared

    Rental income ($26,000) is less than total deductions — a shortfall you fund out of pocket.

    -$10,000.00

  3. 3

    Estimated tax saved

    The rental loss reduces your other taxable income, saving tax at your marginal rate.

    $3,000.00

  4. 4

    Negative gearing fully grandfathered

    Acquired before 7:30pm AEST 12 May 2026, so this established dwelling is grandfathered indefinitely — Law from 12 May 2026 (Treasury Laws Amendment (Tax Reform No. 1) Act 2026).

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Assumptions

  • Depreciation is held constant across the projection — in reality Div 40/43 deductions typically decline over time.
  • Marginal rate is recalculated each year by stacking that year's rental position on top of your other taxable income (assumed constant across the projection).
  • Assumes the property is held by an individual for the full financial year in each projected year.
  • "New build" is not yet defined in the Act (pending ATO guidance) — treated here as a user-asserted flag.

Note

These figures are estimates only, based on the assumptions above. They do not constitute financial, tax, or accounting advice. Please consult a registered tax agent or accountant before making any decisions. We accept no liability for any loss arising from reliance on this calculator.