Taxation and Real Estate: Smart tax-saving strategies for investors and developers
The real estate market in India is booming, with a myriad of growth prospects for the years to come. In the current year, the market stands at a whopping USD 265.18 billion and is anticipated to reach USD 828.75 billion by 2028, growing at a CAGR of 25.6%, according to a study by Mordor Intelligence. Despite this current growth after the pandemic, real estate has always been a safe haven for investors to earn a long-term profit. Similarly, for developers, it is a lucrative avenue as it provides several opportunities to not only showcase modern architecture but also earn a hefty ROI (return on investment).
However, profits earned also attract relevant property taxes that an individual or a limited liability company has to pay to the government. In the event of avoiding this payment, it further attracts a fine and, in some cases, strict legal action. Despite all these circumstances, one can always save tax if they have the right strategies at their disposal. This article discusses some of the smart tax strategies that could help investors and developers save money on taxes.
If you are a real estate investor or developer, then you might have to pay several taxes, including municipal corporation tax, goods and services tax (GST), stamp duty, registration charges, and more. With a myriad of taxes, it becomes daunting for an individual to devise a perfect strategy for any specific tax. However, with the amalgamation of different smart strategies, a collective positive result can be attained.
Also Read: 5 things you must do after buying a house
While real estate can provide astonishing appreciations in value, it is still subject to depreciation. Therefore, investors as well as developers use this strategy to save taxes on
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