INVESTMENT IN PROPERTY

Investment in Property - Summary



Investment in Property - Summary

Summary

The paper presents a comprehensive analysis on investment in property. It details the advantages and disadvantages for investment in real estate property. Investments in secure assets such as in real estate continue offering the greatest and most consistent opportunities to build wealth and financial security. Investment in property provides return in the form of capital gain and rental income generated from the property. It is necessary to consider the risk associated with the devaluation of property based on macro-economic factors. In case of a loss, sale of property is not subject to any tax; however, marginal tax is implemented on the sale of property if the capital gain amount exceeds the £10,100 limit at the time of sale. This give tax advantages associated with negative gearing.

Investment in property is preferred over shares purchasing based on the subjectivity in the price structuring of shares and hyping speculation in the stock market. Intensive investment is required for property with a long-term distributed return rate. This shows that property cannot be converted in to cash readily. Under Private Residence Relief in UK taxation, no tax is levied on capital gain from selling of property that was being used as living home by a person. Capital gain tax set by UK govt. For the year, 2010-11 on property selling is 18 percent. In contrast, capital gain in year 2011 will be charged in two slots of 18 percent and 28 percent, depending on the total amount of your taxable income. However, trustees or personal representatives of someone who has died have to pay 28 percent from capital gain on property.

In contrast, people qualifying for 'Entrepreneurs' Relief' would be required to pay only 10 percent tax on property under UK Taxation Law for ...