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SavingsMate

Negative Gearing Calculator

Calculate your negative gearing tax benefit on an investment property. See rental income vs deductions, tax savings at your marginal rate, and after-tax holding cost.

Last verified: 1 July 2025

How much tax does negative gearing save in Australia?

Negative gearing occurs when property expenses (loan interest, rates, insurance, maintenance, depreciation) exceed rental income. The loss offsets your other taxable income, so your saving is rental loss × marginal tax rate. At 30% MTR, $10k loss saves $3,000; at 37% saves $3,700; at 45% saves $4,500. Negative gearing remains fully available in 2026. Source: Australian Taxation Office.

Worked example. Rental income $26,000; total deductions $41,000 (interest $28k, rates $2.5k, insurance $1.5k, management $2.6k, maintenance $3k, depreciation $3.4k) → rental loss $15,000. At 37% MTR, tax saving is $5,550, so the after-tax holding cost is $9,450/year (~$182/week). The strategy assumes capital growth outpaces this holding cost.
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Rates, insurance, maintenance, strata, property management

General information and estimates only — not financial, tax, or legal advice. Always verify with a licensed adviser or the ATO.