4 ms·
I think you have misunderstood how taxation works. If you rent out a house, the rent is income, which you are taxed on. The deduction means that you don't have
by bollorior 6y ago
I think you have misunderstood how taxation works. If you rent out a house, the rent is income, which you are taxed on. The deduction means that you don't have to pay taxes on the gross amount, but only on the net income after you've paid the mortgage on the property. In almost all cases the rental income will be higher than the mortgage payment, so you will still pay some tax, more than the person who lives in a property they own with a mortgage.
- adamjb 6y ago>In almost all cases the rental income will be higher than the mortgage payment 60% of Australian landlords claimed a rental loss in FY17/18 and that's not an outlier. [0] In jurisdictions where rental losses can be written off against ordinary income, landlords are happy to collect the tax benefit and just do the capital play. [0] https://www.theguardian.com/business/grogonomics/2020/jul/21/middle-australia-earns-100000-and-has-a-negatively-geared-property-not-true https://www.theguardian.com/business/grogonomics/2020/jul/21...
- bollorior 6y agoI am prepared to accept that 'almost all cases' does not include the insanity particular to the frothiest 60% of the Australian housing market ;)