With the correct advice and the correct property negative gearing is the most tax efficient strategy. This helps to lessen your tax bill as well as give you the opportunity to increase your property portfolio with less outgoings.
Negative gearing in property is where the costs of holding a property exceed the return on that property. This gives you an opportunity to use these losses in order to create a better situation for you financially. This is the opposite of Positively Geared properties where the returns exceed the expenses of the property.
There are 3 main types of expenses that you can consider to be used for negative gearing:
- Revenue Deductions
- Claim for capital investments
- Claims for building allowances
Negative gearing is a tool to be used in order to further expand your financial situation. A investor should be able to absorb the costs of an investment property with or without the use of negative gearing.
Negative gearing has being around since the 1930's and has been used by investors as a tool to make it much more affordable to accumulate multiple property portfolios. These properties in return can help you fund your retirement in different scenarios.
It also helps an investor with its cash flow thus helping an investor the ability to either pay of their own mortgage faster or have that little bit of cash in their everyday life.
Contact one of our Sales Consultants in order to see how negative gearing can work best for you in your own scenario.