top of page

Disclaimer

This blog is for general information purposes only and is not intended to be financial, legal, or tax advice. The content has been prepared without taking into account your individual objectives, financial situation, or needs. We strongly recommend speaking with a licensed financial adviser, accountant, or legal professional before making any investment decisions. Bridge Projects Group does not provide financial advice and is not licensed to do so.

Can You Really Use Your Tax to Pay Off Your Mortgage?

  • Wealthprint Property Advisory
  • May 7
  • 3 min read

By Wealthprint Property Advisory


ree

The Truth About “Tax Redirection” Property Strategies in Australia


If you’ve seen online ads promising that you can “redirect your tax” to eliminate your home loan in under 10 years — you’re not alone. This language is trending fast in the investment space. But what’s the truth behind these so-called tax redirection strategies?


Here’s what these property ads are really referring to — and what every investor should know before diving in.


What Is “Tax Redirection” Really Referring To?


There’s no legal way to send your income tax directly into your mortgage repayments. What these strategies leverage is the tax advantages of owning an investment property, combined with a structured loan and cash flow plan.


The goal is to legally reduce your taxable income, improve your weekly cash flow, and redirect that improved cash position into your personal mortgage offset account.


Common elements of this strategy include:


  1. Negative gearing – Claiming rental losses to reduce your taxable income.

  2. Depreciation benefits – Deducting building and asset depreciation (especially on new builds).

  3. PAYG withholding variation – Receiving tax benefits throughout the year instead of at tax time.

  4. Offset account strategy – Using surplus income to reduce interest on your home loan.


When structured correctly, these techniques can create a cash flow advantage that helps reduce non-deductible debt (your home loan) faster — without changing your income or lifestyle.


How the Strategy Typically Works


This structure is most commonly recommended to:


  • PAYG earners or couples earning over $120,000 combined.

  • Homeowners with available equity.

  • Buyers interested in new house-and-land packages or off-the-plan apartments.


Step-by-step flow:


  1. Equity from your home is used to secure an investment property (often 100% leveraged).

  2. Tax deductions (via negative gearing and depreciation) reduce your taxable income.

  3. PAYG variation allows you to access tax savings weekly, not annually.

  4. Rental income + tax savings are directed into your offset account.

  5. Reduced interest on your home loan accelerates repayments.

  6. Property value grows, creating further wealth through equity.


In theory, the extra cash flow helps pay off your mortgage faster — all while building a property portfolio.


ree

Benefits of a Tax-Focused Investment Strategy


When implemented carefully and backed by solid advice, this strategy can offer:


  • Improved cash flow by reducing tax paid on your income.

  • Leverage to build wealth using borrowed funds and capital growth.

  • Offset account flexibility to manage repayments and reduce interest.

  • Smart use of depreciation to lower your taxable income.

  • Potential for long-term financial freedom via wealth-building property assets.


What Are the Risks and Red Flags?


While the concept can be sound, the execution matters most. In our experience, problems arise when:


  • The property is overpriced or in a low-growth location.

  • The project carries developer commissions of $20k–$40k baked into the price.

  • Marketing claims are exaggerated or intentionally misleading.

  • Investors take on too much debt or rely solely on capital growth.

  • There’s no clear exit strategy or protection against interest rate rises.


These pitfalls can leave investors with poor cash flow, underperforming assets, and long-term regret.


Warning Signs to Watch Out For


  • Promises like “pay no tax” or “use your tax to pay off your mortgage”.

  • Unlicensed promoters or marketing companies selling the strategy.

  • Pressure to sign quickly, pay deposits upfront, or attend high-pressure webinars.

  • Property valuations not matching the purchase price.

  • Lack of disclosure around fees, commissions, or ongoing costs.


How to Proceed Safely


Before moving forward, we recommend the following due diligence:


  • Speak with a licensed financial adviser or accountant.

  • Request an independent valuation — not just marketing brochures.

  • Get a detailed cash flow breakdown, including best- and worst-case scenarios.

  • Know your risk tolerance and goals — this is not one-size-fits-all.


Ask about the exit plan — what happens if you want to sell, refinance, or rates rise?


Final Thoughts: Don’t Buy Into Hype — Buy With Strategy


The so-called tax redirection method is just one approach to structuring your investment intelligently. It can work — but only if the property performs, the advice is sound, and the numbers actually add up.


At Wealthprint, we don’t sell one-size-fits-all strategies. We focus on:


  • Structuring property purchases around your goals.

  • Selecting investment-grade properties that meet strict financial criteria.

  • Building a long-term roadmap — with transparency and clarity at every step.


We’re not here to sell hype. We’re here to help Australians invest with intention.


Want Help Reviewing a Property or Strategy?


We can assess your current investment options and walk you through what’s actually viable for your situation — no pressure, no sales script.



bottom of page