The salaried class in particular doesn’t have to worry much
about paying taxes. The employers take most of the headache. Though, the employers complete the tax paying job
at the tax payer’s office, yet, it is equally valuable to know what lies in
store for them. The business class has an array of options to pay taxes, which
may include travelling expenses, and many other drawers, but salaried class has
a fixed set of options where they can make their savings. Insurance being one
of them, though, I am not too convinced that they actually help build your
wealth.
I want to relate a real life story on how a person actually
made a lot of money and also saved
taxes at the same time. That person incidentally is my close friend. He was
in need of a house in a particularly expensive city and was looking for a
housing loan. Once the loan was approved, he bought a large apartment at a
prominent location in the city. Within five, years, the real estate prices increased.
With the baggage of a loan weighing on his mind, he decided to sell the house,
and repay the loan off.
Believe me; he sold his apartments close to double the
amount he purchased. There were two advantages that came along his way. The
first, that he was able to avoid
taxes during those 5 years, and secondly, he made a massive profit with the
sale of his house, which incidentally enabled him to invest heavily on other
projects. That’s the kind of profit associated with making the right real
estate investment decision.
Key points to
remember
There are few things here, which should be taken into
account. No matter what kind of work you do, there are possibilities that you
will have to endure the burden of tax. When you do seem to face that kind of
situation, you have a choice. Either you pay taxes or get
a home loan. If the taxes don’t amount to a great deal of money, then you
might prefer to pay taxes. But if, the tax amount starts to hurt you, you don’t
have a choice; better take a loan to buy a property.
You can now save taxes, and it also helps you to lay a platform
to create wealth by selling the property, when the price of your property
increases. However, you should exercise a certain degree of caution when buying
a house. Learn about the place where you intend to buy a house. The place should
be located in a prime location, and it should soon be a highly sought after area in
terms of real estate marketability.
By Rajiv Sighamony
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