There are several reasons behind the tax problem for all property owners. If you want to buy a new property for living then the tax that have to be paid by you might be same as the rate of the property sometime. People do not care about it when they buy a home but this should not be ignored.
If you take a property through the agents then you have to pay more taxes in some places. Plus you have to pay government tax. In many cases you can see that the calculation of taxes is wrong by the government but you have to pay that. Then it will be a force on you.
Always determine the fair market value and the tax rate and the deductions, if any. Match the amount of the tax with the tax said by government and then pay it. If you get anything incorrect, report it to immediately.
Negative gearing is the act of borrowing money to buy an asset which may or may not later earn the borrower some tax advantages.
It has its own advantages and disadvantages. It offers the borrower tax advantages in the event of his investment making a loss and the promise of long term gains in the form of capital appreciation, thus presenting the borrower the mouth-watering situation of saving tax as well as making money.
Many countries in the world exempt some taxes citing deduction of negative gearing losses as the reason. However, as always, the truth is often overlooked as one can be tempted by the win-win situation.
There is a huge risk in negative gearing as the losses associated with it can be huge. Thus, the borrower should always be at hand to withstand the shortfall and to fund the negative flow of cash. It is proven money making strategy, but keeping in mind the risks involved, it’s not a very reliable one.