ADS.finance
All calculators
Mortgage

Negative Gearing & Investment Property Cash Flow Calculator

Work out what an investment property actually costs to hold each week after tax. It separates the cash position from the taxable position - depreciation is deductible without being a cash cost, which is why the two differ - and shows the capital growth needed just to break even.

Your details

$
$
%
$

Income

$

Costs

$

Council rates, water, strata, insurance, management fees, repairs.

$

From a quantity surveyor report. Only new or recently built properties claim plant and equipment.

After-tax cost
$8,038
Per week
$154.58
Tax benefit
$8,062
Gross rent
$620/week
$32,240
Less vacancy
2 weeks
− $1,240
Rent received$31,000
Loan interest− $38,100
Other expenses
Rates, insurance, management, maintenance
− $9,000
Cash flow before tax$-16,100
Depreciation
Deductible, but not a cash cost
− $8,000
Taxable profit / (loss)$-24,100
Your marginal rate39.0%
Tax reduced by+ $8,062
After-tax cash flow$-8,038
Gross rental yield4.30%
Net yield before interest2.93%
Capital growth needed to break even
Annual growth that offsets the holding cost
1.07%
2026-27 ATO rates, checked 3 August 2026.
The property runs at a $24,100 taxable loss, which offsets your salary and reduces tax by $8,062. That is negative gearing - you are still out of pocket $8,038 a year after the benefit.
Depreciation of $8,000 is deductible but is not a cash cost, which is why the after-tax position is better than the cash position. It also reduces your cost base, increasing capital gains tax on sale.
A tax deduction is not a return. Losing a dollar to save 39 cents still leaves you 61 cents down - negative gearing only works if capital growth exceeds the accumulated holding cost.

Related calculators

ICR & DSCRInterest-only vs P&IIncome tax

Frequently asked questions

Is negative gearing worth it?

Only if capital growth outruns the accumulated after-tax holding cost. Deducting a loss at a 39% marginal rate means the government funds 39 cents of each dollar lost, and you fund 61. The calculator shows the annual growth rate needed just to break even - if that number looks ambitious for the area, the deal relies on hope rather than arithmetic.

Why is the after-tax cost better than the cash cost?

Depreciation. It is a deduction without being money out the door, so it increases the taxable loss without increasing the cash loss. That is genuinely valuable, but it is deferral rather than a free gift - depreciation reduces your cost base and therefore increases capital gains tax when you sell.

Can I use the tax benefit to help service the loan?

You can vary your PAYG withholding so the benefit arrives each pay rather than as a refund. Lenders assess investment loans on the rent and your income, typically shading rent by 20% for vacancy and costs, and most will not count the tax benefit at all.

General advice warning: This calculator provides general information only. It does not take into account your objectives, financial situation or needs, and it is not personal credit or financial advice.

Results are estimates based on the inputs and assumptions shown. Any interest rate used is an example and is not an offer of credit. Speak to a licensed credit representative before acting on these figures.