Hi all,
I have been reading for a while now, and I'm looking at purchasing my first IP. I've decided to start out fairly small.
I've been running through my figures and they look like the below. What I'm confused about is the negative/positive gearing side. The property should earn approx $16,640 per year (F), the interest repayments will be ballpark $13205 (G), there will be a difference of $3434 (H). I take it this means G will be tax deductible whilst I'll need to pay tax on H. Then there's the deductions aside from the interest (I). If (I) exceeds (H) I take it the difference is then tax deductible?
(insert confused face here)
Thank you for the assistance
I have been reading for a while now, and I'm looking at purchasing my first IP. I've decided to start out fairly small.
I've been running through my figures and they look like the below. What I'm confused about is the negative/positive gearing side. The property should earn approx $16,640 per year (F), the interest repayments will be ballpark $13205 (G), there will be a difference of $3434 (H). I take it this means G will be tax deductible whilst I'll need to pay tax on H. Then there's the deductions aside from the interest (I). If (I) exceeds (H) I take it the difference is then tax deductible?
(insert confused face here)
Thank you for the assistance
A Property amount: $350,000
B Stamp duty: $17,000
C Other: $3,000
$370,000
D Deposit: $110,000
E Loan amount: $260,000 70% LVR
F Expected gross income: $16,640.00
G Expected interest repayments (4.60% @ 25yr) $13,205.40
H Difference between gross income & interest $3,434.60
I Tax deductible claims TBA