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Labor’s negative gearing restrictions would apply to all investments

If you thought that the proposed changes to negative gearing would only apply to property investment, then it’s time to think again.

Earlier this month Professor Robert Deutsch, Senior Tax Counsel with The Tax Institute*, Australia’s leading forum for the tax community, was able to confirm with the Australian Labor Party that proposed changes to negative gearing would apply across the board to all investments – not just property investments.

It is further explained that the proposed restrictions to negative gearing would apply on a global basis to every taxpayer.

So, what does this mean for you if you’re negative gearing?


Professor Robert Deutsch explains that all individual taxpayers will need to look at the totality of their investments.

He says - “If the total of the interest and deductions related to investments exceed the investment income, the excess will not be able to be used for offset against other non-investment income. This excess will need to be carried forward for offset against future investment income or capital gains. Importantly, you will not have to look at each individual investment, or at any particular asset class – that would have been a very onerous and cumbersome exercise”.

The proposed new changes will continue to allow people to hold several properties with some positively geared, and some negatively geared, so long as the overall positives exceed the overall negatives.

To find out more about negative gearing and what the proposed changes mean for you, talk to us today.

*Source: The Tax Institute - Labor’s negative gearing restrictions – good news and bad news for investors.