charging rent at market rate is a matter to be considered although it may not always work out as you apportioned. there was an old legal case (Kowal, in lowly Supreme Court), which is still current in the ATO ruling, where the court allowed 80% of the deductions even though the rent paid was 20% of market value:
that said, Kowal is a pre-CGT case so a court may see differently now since capital gains may be distinguished from rental income as the source of 'earning assessable income' (in other words, interest may be placed on the CGT cost base if it is determined the primary purpose of the property is for capital gain rather than rental income)
