An offset account is a transaction account linked to your home loan. You can deposit your salary and savings into the account and the balance is then offset against the amount owing on your home loan.
For example, if you have a home loan of $350,000 and $20,000 in your offset account, you’ll only be charged interest on a loan balance of $330,000. Your $20,000 is therefore saving interest at the home loan rate, as opposed to earning taxable interest at a generally much, much lower rate.
