Negative gearing calculator
Work out your rental loss, the tax you get back, and what your investment property really costs you each week after tax.
Negatively geared (2026-27)
What the property costs you after tax
$115/wk
$5,968 a year out of pocket
Your marginal rate
30% + 2% Medicare
Tax returned per $1 of loss
32c
A rental loss still counts towards your HECS-HELP repayment income and your income for the Medicare levy surcharge, so it does not reduce either.
Make sure you claim everything
Depreciation schedules, interest on redraws, and which costs are repairs versus improvements are where property investors most often miss out. A tax agent who works with investors can check.
Browse tax agents for property investorsTax saved by rental loss and income (2026-27)
How much tax a rental loss saves, by your taxable income before the property. Includes the 2% Medicare levy. The rest of the loss is still your cost.
| Income | Loss $5,000 | Loss $10,000 | Loss $20,000 |
|---|---|---|---|
| $60,000 | $1,675 | $3,350 | $6,125 |
| $90,000 | $1,600 | $3,200 | $6,400 |
| $150,000 | $1,950 | $3,900 | $7,450 |
| $220,000 | $2,350 | $4,700 | $9,400 |
How the calculator works
- Rent is your weekly rent times the weeks the property is let.
- Cash costsare the deductible expenses you actually pay: loan interest, rates, strata, insurance, the agent's fee, repairs, land tax and anything else you enter.
- Depreciation is deducted for tax but is not a cash cost, so it lowers your tax without lowering your cash flow.
- Tax saved is the difference between the tax (and Medicare levy) on your income with and without the rental result.
- Cash flow after tax is rent less cash costs, plus the tax you save. That is what the property costs you to hold.
When you eventually sell, the gain is taxed under the capital gains rules. Use the capital gains tax calculator to estimate that tax.
Negative gearing changes from 1 July 2027
The 2026-27 Budget proposed limiting negative gearing on residential property to new builds from 1 July 2027:
- Properties held at 7:30pm AEST on 12 May 2026 (including contracts signed but not settled) could still be negatively geared until they are sold.
- Established properties bought after that time and before 1 July 2027 could be negatively geared until 30 June 2027, but not after.
- Established properties bought from 1 July 2027 could not be negatively geared against salary.
- New builds could still be negatively geared.
Where the new rules apply, rental losses could only be deducted against income and gains from residential property, with any excess carried forward to future years. Commercial property and shares would not change. The Treasury Laws Amendment (Tax Reform No. 1) Bill 2026 passed the House of Representatives on 4 June 2026 and was referred to a Senate committee. It is not law until it also passes the Senate. This calculator uses the current rules, which apply to 2025-26 and 2026-27 either way. See the Budget explainer and the Parliamentary Library bills digest.
Source: ATO residential rental properties.
Frequently asked questions
What is negative gearing?+
A property is negatively geared when its deductible costs (loan interest, rates, insurance, management, repairs and depreciation) are more than the rent it earns. The resulting rental loss reduces your other taxable income, such as your salary, so you pay less tax.
How much tax do I get back from negative gearing?+
Roughly your marginal tax rate plus the 2% Medicare levy for each dollar of rental loss. At a 30% marginal rate you get about 32c back per $1 of loss, so a $10,000 loss saves about $3,200. You still pay the other 68c yourself.
Is negative gearing worth it?+
Only if the property grows in value enough to cover the after-tax losses you fund each year, and the capital gains tax when you sell. The tax saving alone never makes up the loss. This calculator shows the after-tax cost per week so you can compare it with expected growth.
Can I claim loan principal repayments?+
No. Only the interest on a loan used to buy the rental property is deductible. Principal repayments are not, and interest on any part of the loan used for private purposes is not either.
What is depreciation on an investment property?+
Depreciation (capital works and plant and equipment deductions) lets you claim the wear and tear of the building and its fittings. It reduces your taxable income without any cash leaving your pocket, which is why it matters so much for negative gearing. A quantity surveyor prepares the schedule.
Is negative gearing being abolished?+
Not for existing properties. The 2026-27 Budget proposed that from 1 July 2027, losses from established homes bought after 7:30pm AEST on 12 May 2026 can only be used against residential property income and gains, not salary. New builds, and properties held before the announcement, would keep negative gearing. The bill passed the House of Representatives on 4 June 2026 and was referred to a Senate committee. It is not law until it also passes the Senate.
General information only, not tax advice. Estimates use Australian resident rates published by the ATO (rates last checked 27 September 2026) and assume no other income, offsets or exemptions unless entered. Assumes you are an Australian resident individual who owns the property alone. For joint ownership, enter your share of the rent and costs. Nothing you enter leaves your browser. For advice on your own situation, speak to a registered tax agent.