5 TYPES OF REAL PROPERTY TAXES
When you buy a property, whether it is a commercial property or residential property, there are always going to be taxes associated with the property. Some people think that when they pay off the mortgage or loan associated with the property that they own, they hold the view that no more they will have to pay any more money because they own it free and clear. However, it doesn’t quite work like that.
You will have to pay taxes on the property for as long as you own it. If you own a business, you will also have to pay several different types of taxes as well. As a business owner, you will have to pay your employees to work, and then you will have to pay taxes to the government on the wages that they earn. Individuals and businesses are required to file tax returns at the end of every year.
If you are a business and you have a loss for the year, then you probably won’t owe any money. However, if your business had even a small profit, you will owe taxes on the actual profit. Today we are going to take a look at the different types of real property taxes that you need to be aware of.
If you just own a piece of land and there are no improvements on the land, then you will pay taxes on the value of the land every year. The country in which you live will access the property and attach a value to it, and that value will determine how much you will have to pay in taxes every year.
Improvements to the Land
Improvements to the land can be several things. One of the most common improvements to land is a building or a living structure. These can already be on the actual when you purchase it, or you can have it added after you purchase it. An improvement to the land will increase the value of the property, and therefore, it will also increase the amount of taxes that you will have to pay. An improvement can be big or small, but rest assured it will increase the value of the property.
This category has a broader definition of what the actual items can be. For example, if it’s a commercial piece of property and you have an office located on the property, then you will have office furniture and office equipment. You will actually have to pay taxes on the value of the office furniture, fixtures, and equipment. If it’s a residential piece of real estate, then a fence around the property could be considered personal property and an improvement to the land.
Intangible Property Tax
This one can get a little tricky. Intangible property taxes are taxes on items that you can’t actually touch. This is hard for us to wrap our minds around sometimes, but it’s a real tax, so it must be addressed. Let’s say that you are an inventor and you come up with a business idea and you copyright it. You would have to pay copyright taxes. It’s not something that you can actually touch but you will have to pay taxes on it.
Every time you purchase something, there is going to be a sales tax involved. Whether you purchase something at the gas station or at the supermarket, there is going to be a sales tax added whenever you check out at the register.
Paying taxes is something that you are simply just going to have to get used to doing because it will be a part of your life forever. Thankfully there are real estate law firm Israel that can assist you with all of your tax questions and concerns.