Estimate how much tax the interest on your recycled investment split could save each year, and what the loan costs you after tax.
Home › Debt Recycling Tax Calculator
Enter the amount you have recycled, an assumed interest rate and your taxable income. The calculator returns four figures.
The amount recycled is the balance of your investment split, the part of the loan used only to invest. If the strategy is new to you, start with our guide to how debt recycling works.
The calculator uses the Australian Taxation Office (ATO) rates for Australian residents in 2026-27, which include the cut from 16% to 15% that started on 1 July 2026. The Medicare levy adds 2% of taxable income.
| Taxable income | Tax rate | Rate used in the calculator |
|---|---|---|
| $0 to $18,200 | Nil | 0% |
| $18,201 to $45,000 | 15% | 17% |
| $45,001 to $135,000 | 30% | 32% |
| $135,001 to $190,000 | 37% | 39% |
| $190,001 and over | 45% | 47% |
People on lower incomes may pay a reduced Medicare levy or none. The calculator does not adjust for this.
Say you have recycled $200,000 into an investment split at an assumed rate of 6% a year. That creates $12,000 of deductible interest.
| Taxable income | Rate used | Tax saving | After-tax cost | After-tax rate |
|---|---|---|---|---|
| $100,000 | 32% | $3,840 | $8,160 | 4.08% |
| $150,000 | 39% | $4,680 | $7,320 | 3.66% |
| $250,000 | 47% | $5,640 | $6,360 | 3.18% |
The after-tax rate is the return your investments need to beat, after tax, before the strategy adds anything. Our guide on whether debt recycling is worth it walks through that hurdle.
The maths is kept simple, so treat the result as a starting point.
The ATO allows a deduction only for interest incurred for an income-producing purpose, such as borrowing to buy shares that pay dividends. If part of a loan is used for private spending, the interest must be split between the two purposes.
That is why the investment split needs to stay separate and be used only to invest. Our page on how we structure the loan shows the setup that keeps the deduction clean.
For the rules in more detail, read our guide on whether debt recycling is tax-deductible.
We arrange the lending and set up the splits. We do not give tax advice or recommend investments.
The calculator gives a quick read on what recycled debt costs after tax at 2026-27 rates. Your real saving depends on your full tax position and on the investment split being used only to invest.
Use the figure to frame your questions, then have your tax agent confirm it before you rely on it.
Book a free, no-obligation call with Alex to see whether your loan can be split cleanly for investing.
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Roughly your deductible interest multiplied by your marginal tax rate plus the 2% Medicare levy. On $12,000 of interest at 39%, that is about $4,680 a year. A registered tax agent can confirm your figure.
The 2026-27 Australian resident rates: nil up to $18,200, 15% to $45,000, 30% to $135,000, 37% to $190,000 and 45% above that. It adds the 2% Medicare levy for incomes above $18,200.
No. Interest is generally deductible when the borrowed money is used to earn assessable income, such as dividends. If the loan is also used for private spending, the interest must be apportioned.
No. A deduction reduces the cost but does not remove it. At a 39% rate you still pay 61% of the interest yourself.
Your refund depends on your whole tax return, including other deductions, offsets, the Medicare levy surcharge and any study loan repayments. A large deduction can also move part of your income into a lower bracket.
A broker can structure the loan so the investment borrowing stays separate and traceable. Confirming your deduction and tax position is the job of a registered tax agent.
Use our offset vs debt recycling calculator to compare keeping cash in offset with recycling it, after tax and the capital gains rules from July 2027.
Read more → GUIDELearn when investment-loan interest may be deductible under ATO principles, including the purpose test, tracing and common setup errors.
Read more → GUIDELearn seven structural debt recycling mistakes that may put interest deductions at risk, including mixed splits, redraw and parked funds.
Read more →
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2. Met requirements to have funding available by a specified date.
3. Understood my needs to setup debt recycling to allow tax structuring.
4. Communicated well throughout.
I would use their services again.
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Jess from Kingfisher was outstanding. I couldn't fault her communication, expertise or dedication to finding the best loan for our situation. The entire process was seamless from start to finish. We'll definitely be using Kingfisher again in the future. A top-tier organisation.
