Now on another note, can you advise me about my perceptions on matters property and income tax. Now I see that after a year of property ownership, you’re taxable income will jump by a fair amount depending on you’re rental income. In my case $14,560 for my first Investment Property. Thus I assume this is added to you’re wages to get total income, against which you then offset you’re property expenses.
Does this in effect have the potential to push you into a higher tax bracket ? making the next property investment even more affordable the next time around? Whether you are doing an end year or 15-15 assessment from there, I assume you are moving closer to higher tax bracket and thus better positions for the next property tax deduction benefits ?
Is that how it works ?
It depends on your net rental income, not just your rental income. If your property is -vely geared, your income goes down. If +vely geared, it goes up. Kapish?
Ahh so its your net cash flow for the year which determines your net income. of course ! then u get ur deductions for depreciation. Doh! Thanx i should have known that. i did know it but i forgot.
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