常用词
Cash Flow Positive – you have a cash flow positive investment if the incomings are more than your outgoings after tax-deductible items have been claimed. You receive more rent than your mortgage repayments, plus you are still ahead after taking into account items such as interest on the loan, maintenance, insurance, land tax, rates, etc.
Negatively Geared – this is where the incomings are less than your outgoings after all tax deductions have been claimed. For example, you receive rent on a property of $600 a month, but your mortgage repayments are $900 a month. Your shortfall is $300 a month, which you can claim as a loss when doing your tax return. Many people on high incomes use negative gearing to reduce their taxable income.?? Another way to look at this is if the total of deductable outgoings e.g. loan repayments, rates, repairs, exceeds the income (rent for a property) then it is said to be negatively geared. Investors often use negative gearing to reduce taxable income as the loss can be deducted from other earnings. When the property is ultimately sold, then the capital gain should be more than any accumulated losses otherwise it would have been a poor investment.
Positively Geared – this occurs when the investment income exceeds your interest expense (and other possible deductions). For example, the rent you receive may be $1000 a month, but the monthly repayments are only $750. Note that you may be subject to additional tax on any income derived from a positively geared investment.
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