Search results

Thamks Alex, that makes sense.

Hi Alex, Correct me if I'm wrong, but using your calculations: $60k package ($55k salary and $5k super) If you salary sacrifice $40k, your taxable income would be $15k, and the required super contribution payable by your employer would be $1350 (9%) By my calcs, you have lost $$3650 in...

After seeing your calculations, I hope your brother got a second opinion!

Your overall position without property Income $100,000 Tax $ 27,500 Net $ 72,500 With property, negatively geared, showing $10,000 loss without depn. Income $ 90,000 Tax $ 23,350 Net $ 66,650 Difference is $5850. Let's say you saved all of this income. How much less would you...

No, no, no. You pay $10,000 to the bank, no $5850. Then the govt refunds you the $4150 tax that you have paid on this $10,000. You are confusing yourself why asking what it takes 'before tax' to earn $5850 after tax. Because the interest is tax deductible, your calculation is...

OK, I'll try again. You are confusing yourself with after-tax and before-tax dollars. If you only owned the property, and spent your money on nothing else, the money in your hand would be $5850 less than if you didn't own the property. This is because the property expenses are tax deductible...

Manoj, if you have the property, your after tax income is $72,500. If you don't, your after tax income is $66,650. The difference is $5850. You are not taking into account the tax saving of $4150 in your calculations. So you are not right.

The point you are missing is the $4150 that you are paying in tax on your earnings, is refunded at the end of the year.

Your overall position without property Income $100,000 Tax $ 27,500 Net $ 72,500 With property, negatively geared, showing $10,000 loss without depn. Income $ 90,000 Tax $ 23,350 Net $ 66,650 Difference is $5850.