There are many benefits in purchasing an investment property. The possibility of gaining rental income, the expectation of the property's value may grow, and also the tax reduction you may receive from negative gearing. Whatever the reason property investment is a sound way to secure your financial future.
Here's Some Handy Information
Difference between Positive and Negative Gearing
Positive Gearing
Positive Gearing is the ideal position to be in as an investor. This is when your rental income covers your loan repayments and/or any other expenses that you may incur.
Negative Gearing
An investor should be aware of the possibility of negative Gearing.
Negative Gearing is where the return from the rental income is insufficient to meet the costs of the investment.
This may lead towards the reduction in assessable income for taxation purposes.
Tax Deductions.
The benefit of negative Gearing is that it enables you to associate your costs involved with your investment against your tax.
Please note: this information should be used as a guide only. This is not intended to be investment advice. For advice, please speak with a professional tax advisor.
1. The interest calculated on the loan associated with the investment property.
2. Any loan set-up fees i.e. stamp duty, mortgage insurance, loan application fees, and valuations.
3. Traveling expenses you may incur from maintenance inspections i.e. airfares and petrol.
4. Building maintenance and repairs.
5. Expenses i.e. water & council rates.
