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Who is eligible to negative gear investment properties in Australia?
Any person who is liable to pay income tax in Australia, and is eligible to claim deductions to off set the income derived by that person, is eligible to negative gear investment property in Australia.
Subject to some statutory exceptions, eligible persons include:
- individuals who reside in Australia, either by considering the 'ordinary concepts' of residency or by satisfying one of 3 statutory tests contained in the Income Tax Assessment Act 1936;
- companies resident within Australia, i.e. companies whose central management and control are located in Australia;
- non-resident individuals, companies and other entities in respect of income sourced in Australia.
Residency is only one area which must be considered when determining whether an investor is eligible to negative gear investment property. Investors should also consider the objective of acquiring the investment property, as indicated in the commentary on 'negative gearing'. As mentioned earlier, investors should discuss their intentions with their professional advisers prior to deciding to invest in any property.
Also read about positive gearing property > |
