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Debt recycling: The tax hack every investor should know

07 JUL 2025 By Robyn Tongol 2 min read Investor Strategy

In this episode of The Smart Property Investment Show, host Phil Tarrant is joined by Eva Loisance from Finni Mortgages to unpack equity access and debt recycling strategies for property investors.

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The duo begins by clarifying equity as the difference between a property’s market value and its remaining mortgage, noting that up to 80 per cent of this equity can usually be accessed without triggering lender’s mortgage insurance.

Eva explains that accessible equity can then be strategically invested in income-generating properties, offering an alternative to relying solely on cash savings.

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The conversation then shifts to debt recycling, a method of converting non-tax-deductible home loan debt into tax-deductible investment debt by refinancing and splitting the loans.

Phil and Eva stress the benefits of this approach over keeping money in an offset account, highlighting its potential tax advantages and ability to strengthen financial outcomes.

 
 

They also caution against cross-collateralisation, advising investors to keep property loans separate for greater control and reduced risk, with Eva emphasising the importance of financial planning and recommending maintaining a six-month emergency buffer to manage unforeseen costs.

If you like this episode, show your support by rating us or leaving a review on Apple Podcasts and by following Smart Property Investment on social media: Facebook, Twitter and LinkedIn. If you would like to get in touch with our team, email [email protected] for more insights, or hear your voice on the show by recording a question below.

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Debt

Debt refers to the amount of money borrowed from a creditor with the intention to pay back at a specified date.

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