Call us: 1300 860 839
Menu
MAP Home Loans > Blog > Australian Expat Home Loans > Negative gearing for Australian Expatriates

Negative gearing for Australian Expatriates

Nov 3, 2009 by Craig Vaughan

 

Negative Gearing
 
This week I thought I would discuss briefly negative gearing and how it applies to expats living overseas.
 
What is Negative Gearing?
Negative gearing is basically when an asset such as an investment property is purchased and the income from that property (rent) is not enough to cover the holding costs (interest on loan, rates, maintenance) so that an annual deficit or negative is created. Essentially, at the end of year 1 the costs of the property outweigh the rental income received from the property.
 
If you lived in Australia earning AUD then you could potentially write this loss off against your salary reducing the income tax payable. Eg, if you had a salary of $80,000 and the loss from your rental properties was $10,000 then your taxable income would be $70,000 thus resulting in less income tax.
 
Negative Gearing as an Expat:
If you are an expatriate earning overseas income and therefore not paying tax in Australia, the loss or negative from your investment property has nothing to offset against. Importantly, and this is often overlooked by expatriates on their return, these losses can accumulate while you are away so on your return you can use them to offset your income and pay less income tax.
 
Need to know more? More information on Expat Home Loans here.
 

 

FREE Quick-Start Guide To Financing Australian Property

Download PDF Guide

First investment property financed worry-free

MAP Home Loans was fantastic right through the whole process of getting finance for my first investment property. My broker was very knowledgeable and communicated well throughout the process. It was a very worry-free experience. I would highly recommend MAP Home Loans to anyone seeking finance.

Kim Wild-Fyfe

Secured the right loan for our family

We are so grateful for everything MAP Home Loans did to help us with our home loan. From the very beginning, my broker was friendly, approachable, and genuinely cared about making the process as easy as possible for us.

He explained everything in simple terms, answered all our questions with patience, and always made us feel comfortable and supported. It can feel overwhelming, but he went above and beyond to guide us every step of the way.

Thanks to his hard work and dedication, we were able to secure the right loan for our family and move forward with confidence. We honestly couldn’t have done it without him and wouldn’t hesitate to recommend MAP Home Loans to our friends and family.

Tegan

Kept in the loop the whole process

Helpful, responsive and great communication! My broker ensured we were in the loop and knew exactly where things were up to throughout the whole process! Highly recommend MAP Home Loans and will be sure to use them again when required!

Tristan Botha