21/07/2026
Most people never question their home loan interest. It just sits there, quietly costing them money and doing absolutely nothing at tax time.
Debt recycling is the strategy that slowly changes that.
The idea is simple even if the ex*****on isn’t: you pay down part of your home loan, re-borrow that same amount through a separate split and invest it in income-producing assets. Because you’ve borrowed that money to invest, the interest becomes deductible. Do it over enough years and your “bad” non-deductible debt gradually turns into “good” deductible debt, while you build an investment portfolio on the side.
Two things make or break it:
• The structure: the investment borrowing has to sit in its own split, kept completely clean from personal spending. Mix the two and you can lose the deduction entirely. This is where most people come unstuck.
• The risk: it’s still leverage. If markets fall, you still owe the debt. It suits people with stable income, a long runway and a genuine buffer, not someone stretching to make it work.
Get your accountant across the tax side and we’ll handle the lending structure and point you to a lender that actually supports it.
Reckon it might stack up for you? DM us and we’ll walk you through it.
General information only, not tax or financial advice. Your situation is your own, so get advice specific to it before acting.
