Can someone please clarify this for me. I often read about negative gearing meaning that your income (rent) does not meet your expenses (interest/rates/insurance/management fees etc). It never mentions the extra income derived from reduced taxes through depreciation allowances on the IP. For example, on one of my IPs, my rent does not cover my expenses, but after the tax savings I receive through depreciation claims, I’m actually ahead. Surely, this means I am positively geared.
Marco[blush2]
It means you have a “cash flow positive” investment. Postively geared is if it makes a profit before depreciation. Either way a great result.
Thanks for clearing that up shake.
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