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What goes into the income test
Your assessable income from real estate is the gross income you get from it, minus the deductions we allow.
Real estate other than your main home also counts in the assets test. Read about real estate assets and how they can affect payments from us.
Deductions
You can’t claim the same deductions for this as you can claim in your tax return.
What you can claim
Costs you can deduct include:
- loan interest payments
- rates
- costs to maintain the property.
What you can’t claim
Costs you can’t deduct include:
- capital depreciation
- special building write off
- costs to build
- costs of borrowing money such as loan establishment fees.
Details we need
We’ll ask you for a copy of your latest tax return or a profit and loss statement.
Net losses
If you make a loss from your rental property, we count that income as zero.
You can’t offset this loss against the income from:
- another property
- any other source of income.
Income from boarders and lodgers
This is where someone other than a member of your immediate family rents one or more rooms in your main home. Immediate family includes your parents, children and siblings. Board and lodging paid to you by an immediate family member is not income.
Only part of what boarders and lodgers pay you counts as income. The amount depends on whether any meals are included.
| What they pay for | How much counts as income |
|---|---|
| Lodging only | 70% |
| Lodging and breakfast | 50% |
| Lodging and all meals | 20% |
Deductions
If the lodger costs you more than the amount allowed for expenses or what they paid you, we may count less income in the income test. You can show us these costs using your tax return.
You can also deduct either:
- the mortgage interest on your main home
- the rent you pay for your main home.
If your Centrelink online account is linked to myGov you can report the income from boarders and lodgers online.
To do this:
- Sign in to myGov.
- Select Manage Income and Assets.
- Select Other Income.
In some cases, we may treat your income from boarders and lodgers as self-employment income. This applies if you meet either of the following:
- you rent out more than 5 rooms in your home
- you provide accommodation to more than one Homestay International Student and the arrangement is intended to make a profit
It may also apply if you rent out one or more rooms in your home as part of a business you’re involved in.
If you provide Homestay International Student accommodation to only one student, the income is not counted in your income test.
Income from accommodation booking services
This is income you get from home share booking services, such as Airbnb. This means you rent out either:
- one or more rooms in your home
- another property you own.
You may also have income from guests staying on a short term, one-off or irregular basis in your home. You need to report this income as income from boarders and lodgers.
If you regularly have guests booked to stay in your home, we may treat this as income from self-employment.
If you earn an income from accommodation booked for another property you own, you need to report it as rental income.