Tax Deductibility
Tax deductibility refers to whether costs associated with an investment property, such as interest, rates, property management fees and repairs, can be claimed against rental income.
Selecting Not deductible, means these deductions will not be applied.
⚙️ Quick guide on the options :
Investment - Follow the property (previously known as Investment loan option) Follows the property applies tax deductibility based on the Negative Gearing Eligibility selected for the property linked to the loan.
Eligible for negative gearing → Fully claimable tax deductibility
Ineligible for negative gearing → Capped claimable tax deductibility
Fully Claimable: Manually overrides the default treatment and applies fully claimable deductions.
Capped Deductions: Manually overrides the default treatment and applies capped deductions.
Not deductible (Previously knows as Turn off tax deductibility) - No tax deductions are applied.
📝 Note: The manual override options will still follow a conservative approach when displaying results.
Negative Gearing Eligibility
Negative gearing occurs when deductible property expenses are greater than the rental income, resulting in a loss.
The Negative Gearing Eligibility option determines whether this loss can be applied against other income.
If you select No, the property may still have tax-deductible expenses. The resulting loss simply won't be applied against other income.
What should I select?
If the property is not eligible for negative gearing, you need to select No under Negative Gearing Eligibility.
Not sure? Select Unsure and Quickli will help determine the eligibility based on your client scenario. Sample here 👇
💡 Good to know: Selecting No for Negative Gearing Eligibility does not automatically mean the loan should be Not Deductible. Tax deductibility and negative gearing are treated separately in Quickli.
Quickli replicates how each lender treats these scenarios in their calculator. Depending on the lender, an Investment loan marked as ineligible for negative gearing may be treated using neutral gearing or limited tax deductibility
📝 Note: The treatment can vary depending on the lender and the individual scenario.
If you have any questions about this you can reach out to us in the chat box at the bottom right corner of your screen.