Does LOE = never paying income tax again? Are losses carried forward?

[Wishlist]

Assuming a stategy of living off equity, or at least, living off the rents while increasing finance on loans to cover property costs, if rents were lower than costs then it would create a negative 'income' for the year. If the situation continued like that then would it equate to not paying any income tax while using this strategy?

Also with yearly losses (each year's cost being higher than the rental income but with insufficient income to offset against) would these be able to be carried forward to a time when income is positive again eg. sell a property and have the capital gain 'income'?

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[Ausprop]

correct... if you are losing money then you don't pay tax.

however if you are spending the borrowed money on personal expenses then there is no tax deduction. from then on you need to keep detailed records of every cent spent on deduct vs non decuct items. if you repay anything you need to adjust it as a proportional % back

losses can indeed be carried forward to offset future profits.

the danger of course is that there is no capital gain, or worse there is a capital loss. Also you will need to convince a bank to lend you increasing amounts of money when you are losing money, wouldn't be easy.

with the financial and general global upheaval that we will be headed for over the coming decades I think this strategy is best left in text books. If the asset is losing you money then it aint no asset