A frequently asked question we get is why would someone want a negatively geared investment property?

The answer to this depends on what you are trying to achieve from your investment property.

A negatively geared investment property means that the expenses and depreciation are more than the total rent received. This in turn provides the individual with additional deductions for their overall income, including the income received from their employer, resulting in a larger refund for the individual.

A positively geared investment property means that the rent received is more than the expenses and depreciation. This results in the individual having income added on top of the income they have received from their employer. If the client hasn’t withheld additional tax for this, they would potentially receive a tax bill.

So, the answer will depend on whether the individual wants to save on tax or earn passive income. This will determine which situation is best for that person.

If you would like to see which option is best for you, please contact us for assistance.