How the calculator works
- Net rental result = rent received − interest − management fee − other costs − depreciation, multiplied by your ownership share.
- Tax effect = tax on your income alone − tax on your income plus the net rental result. A loss lowers your tax; a profit raises it.
- From 2027–28, a loss on an established property acquired on or after 12 May 2026 no longer reduces your tax. It is carried forward instead.
- Weekly cost after tax = rent − cash costs + tax effect, divided by 52.
Worked example
You earn $120,000 and own a property renting at $600 a week, vacant 2 weeks a year. Interest is $36,000, management 7%, other costs $4,800 and depreciation $5,000.
Net rental loss: $17,900. At a 30% marginal rate plus the 2% Medicare levy that saves $5,728 in tax, so the property costs about $138 a week after tax.
If it were an established home bought after 12 May 2026, from 2027–28 the tax saving drops to $0 and it costs about $248 a week, with $17,900 carried forward.
The 2027 negative gearing changes at a glance
| Your property | Until 30 June 2027 | From 1 July 2027 |
|---|---|---|
| Acquired before 7:30pm AEST, 12 May 2026 | Negatively gear | Negatively gear |
| New build, acquired any time | Negatively gear | Negatively gear |
| Established, acquired on or after 12 May 2026 | Negatively gear | Loss quarantined, carried forward |
Source: Treasury Laws Amendment (Tax Reform No. 1) Bill 2026 — Bills Digest, Parliamentary Library · ATO resident tax rates
Frequently asked questions
Has negative gearing been abolished?
No. From 1 July 2027 it is limited. Established residential properties acquired on or after 7:30pm AEST on 12 May 2026 can no longer offset a rental loss against salary or other income. Properties acquired before then, and new builds, keep negative gearing.
I signed the contract before 12 May 2026 but settled after. Am I affected?
No. The test is when you acquired the property, which is the contract date. Contracts entered into before 7:30pm AEST on 12 May 2026 are grandfathered even if settlement happened later.
What happens to a loss I can no longer deduct?
It becomes a quarantined amount and is carried forward. You can use it against income and capital gains from any residential property you own, including the eventual sale of this one.
What counts as a new build?
Broadly, a dwelling that adds to housing supply — for example one built on vacant land, or a knock-down that replaces one house with more dwellings. A one-for-one knock-down rebuild or an extension does not count. The exact test is set by ministerial instrument, so confirm your property with a tax agent.
What if I inherit a property or receive it in a separation?
A follow-up law (Tax Reform No. 2, passed by the Senate on 19 August 2026) lets property acquired through inheritance or a relationship breakdown keep its existing tax treatment, so a grandfathered property stays grandfathered.
How does joint ownership work?
Rent and costs are split by your legal ownership share, and your share of the loss is deducted at your own marginal tax rate. Run the calculator once for each owner.