Offset Account vs Extra Repayments Calculator

Compare putting spare cash in a mortgage offset account versus making a lump-sum extra repayment. Both strategies save interest, but offset preserves your liquidity and may protect tax deductions on investment properties.

Your current outstanding mortgage balance.

The lump sum to put in offset or use for extra repayment.

Some lenders charge a monthly fee for offset accounts.

Offset preserves tax-deductible debt for investment loans.

Used for investment property tax deduction calculation.

Enter your loan details and spare cash amount to compare offset vs extra repayments.

Frequently Asked Questions

What is a mortgage offset account?
An offset account is a transaction account linked to your home loan. The balance in the offset account is deducted from your loan balance when calculating interest. For example, if you owe $500,000 and have $50,000 in offset, you only pay interest on $450,000.
Do offset accounts and extra repayments save the same interest?
If the amounts are identical and there are no fees, both strategies reduce the interest you pay by the same amount. The key difference is that offset preserves your access to cash — you can withdraw it anytime — while extra repayments reduce your loan principal and may require a redraw facility to access.
Why is an offset better for investment properties?
For investment properties, the loan interest is tax-deductible. An offset account reduces the interest charged without reducing the loan balance itself, so you maintain the full tax deduction. Extra repayments reduce the loan balance, which permanently reduces your deductible debt.
Are offset account fees worth paying?
It depends on how much spare cash you have and your interest rate. If you only have a small amount in offset (e.g., $5,000), the monthly fee may outweigh the interest saving. This calculator factors in the fees so you can see the net benefit.
Can I have both an offset account and make extra repayments?
Yes. Many borrowers use an offset for their everyday banking (keeping liquidity) while also making small extra repayments. For investment properties, however, it is generally better to use only the offset to preserve the tax deduction.
How does the offset affect my minimum repayment?
An offset account does not change your minimum monthly repayment. You continue to pay the same amount, but because less interest is charged, more of each payment goes toward reducing the principal. This is why offset accounts help you pay off your loan faster.
What happens if I withdraw money from my offset account?
Your interest charge increases because the offset balance is lower. This is one of the key advantages of offset over extra repayments — you have full liquidity. With extra repayments, accessing your money requires a redraw, which may have restrictions or fees.
Is a 100% offset account the same as a partial offset?
A 100% offset means every dollar in the account offsets your loan dollar-for-dollar. A partial offset only offsets a percentage (e.g., 40%). Most major Australian lenders offer 100% offset accounts, which provide the full interest-saving benefit. This calculator assumes a 100% offset.

Related calculators

NSW Stamp Duty Calculator Estimate transfer duty, fees and deposits in NSW NSW First Home Buyer FHB stamp duty exemption up to $800k VIC Stamp Duty Calculator Estimate land transfer duty in Victoria VIC First Home Buyer FHB duty exemption up to $600k QLD Stamp Duty Calculator Estimate transfer duty in Queensland QLD First Home Buyer FHB exemption - new homes any price SA Stamp Duty Calculator Estimate stamp duty in South Australia WA Stamp Duty Calculator Estimate transfer duty in Western Australia WA First Home Buyer FHB duty exemption up to $500k TAS Stamp Duty Calculator Estimate duty in Tasmania TAS First Home Buyer FHB duty exemption up to $750k ACT Stamp Duty Calculator Estimate conveyance duty in Canberra ACT First Home Buyer FHB exemption up to $1.02m NT Stamp Duty Calculator Estimate stamp duty in Northern Territory FHOG Calculator First Home Owner Grant eligibility — all states compared Vehicle Stamp Duty Calculator Car stamp duty for all states VIC Car Stamp Duty Victoria motor vehicle duty calculator GST Calculator Add or remove 10% GST instantly Income Tax Calculator Estimate your 2025-26 income tax Pay App Compare salary, bonus, HELP, sacrifice and contractor scenarios Tax Return Calculator Estimate your tax refund or bill PAYG Calculator Calculate tax withholding per pay period Salary to Hourly Convert annual salary to hourly rate Pay Frequency Converter Convert weekly, fortnightly and monthly pay Salary Sacrifice at $100k See how salary sacrifice changes take-home pay Medicare Levy Calculator Calculate Medicare Levy and MLS Family Tax Benefit Calculator Estimate FTB Part A & B payments based on income and family size CGT Calculator Calculate capital gains tax on shares and property FHSS Calculator First Home Super Saver scheme savings Franking Credits Calculator Dividend imputation and tax refunds Investment Property Calculator Rental income and negative gearing Crypto Tax Calculator FIFO CGT, swaps and staking in the crypto app Contractor vs Employee at $100k Compare contractor and employee take-home pay Salary Sacrifice at $100k See how sacrifice changes take-home pay HELP Repayment on $90k Compare salary with and without HELP debt Retirement Planner Model ETF and property paths to early retirement Loan Calculators Mortgage, car, personal, HELP, and business loans Mortgage Repayment Calculator Home loan repayments with extra payment modelling Borrowing Power Calculator Estimate how much you can borrow for a home loan WFH Deductions Calculator Work from home tax deductions HELP/HECS Calculator Student loan repayment calculator Superannuation Calculator Project your retirement super balance Tax Refund Estimator Estimate your ATO tax refund FBT Calculator Fringe Benefits Tax for employers Redundancy/ETP Tax Calculator Tax on redundancy and termination payments Unused Leave Tax Calculator Tax on annual leave and LSL payouts Bonus Tax Calculator How your bonus is actually taxed Company Tax Calculator Company tax at 25% or 30% BAS Calculator GST, PAYG withholding and instalments Fortnightly Tax Table 2026 PAYG withholding for fortnightly pay ATO Interest Calculator GIC on overdue tax debts Sole Trader Tax Calculator ABN tax, deductions, GST and PAYG instalments Tax Buffer Calculator Set aside GST, tax and super from each payment Depreciation Calculator Div 40 & Div 43 asset depreciation Division 7A Calculator Minimum loan repayments for Div 7A EV Novated Lease Calculator FBT-exempt electric vehicle savings Mortgage Calculator Home loan repayments and extra payments NSW Land Tax Calculator Estimate NSW land tax liability VIC Land Tax Calculator Estimate Victorian land tax QLD Land Tax Calculator Estimate Queensland land tax SA Land Tax Calculator Estimate South Australia land tax WA Land Tax Calculator Estimate Western Australia land tax TAS Land Tax Calculator Estimate Tasmania land tax ACT Land Tax Calculator Estimate ACT land tax NSW Payroll Tax NSW payroll tax for employers VIC Payroll Tax Victorian payroll tax for employers QLD Payroll Tax Queensland payroll tax for employers WA Payroll Tax WA payroll tax for employers Division 296 Super Tax Additional 15% tax on super over $3M Downsizer Contribution Up to $300k from home sale into super Spouse Super Offset Tax offset for spouse super contributions Offset vs Extra Repayments Compare mortgage reduction strategies ETF Distribution Tax Tax breakdown on ETF distributions Rent vs Buy Calculator Should you rent or buy? Wealth comparison Invoice Generator Create tax invoices with ABN and GST Payslip Generator Fair Work compliant payslips Quote Generator Professional quotes with GST Non-Resident Tax Calculator Foreign resident rates, FITO offset, temporary resident exemptions

Tax Accuracy & Sources

Reviewed: March 2026 · Tax year: 2025-26

This calculator uses standard amortization formulas with monthly compounding. It assumes a 100% offset account, fixed interest rate, and a one-off lump sum. It does not account for variable rate changes, redraw fees, or ongoing additional deposits to the offset account.

Uses 2025 ATO rates.