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Property investors in Canada have numerous regulations to contend with. Top on the list is the land tax you have to pay if you decide to acquire real estate investment in Canada. Before you start evaluating the different avenues you can follow to cut your tax costs, you need to know what land tax entails. Also, it's important to note that looking for ways to ease the land tax burden doesn't mean you shouldn't pay stipulated levies. Equally, there are land tax thresholds you need to know about and how to exploit them to reduce your tax obligations on real estate property.

When you own a piece of land or two across Canadian states, it may not be much of a problem when paying taxes. However, you may start feeling the tax pinch if you accumulate more land. The more the number of land units you own, the higher your land tax bill shots. Remember, property tax thresholds can differ from state to another, and you need to be smart with set regulations. If you want to purchase more land, take time and think about the impact it could have land transfer tax ontario investment wise.

One way you can capitalize on to lower your taxes is by turning the profit you made from land sales into capital gains. This means that are obliged to pay tax on half of the profit made from a sale. For instance, if you made a profit of $200,000, only $100,000 will be taxed as per the land tax rates.

In Canada, the decision to buy or sell land needs careful consideration. To reduce the tax burden, you need to mark the set dates for land tax assessment. If you are selling, make sure that everything is agreed upon before the time passes. If not, you will be left to settle the taxes. If you close before the set date, the burden is likely to move on to the buyer in the following year. To know more about mortgage, visit http://finance.wikia.com/wiki/Category:Mortgage.

Land investors should strive to acquire property in different states instead of owning different pieces of land in one state. When you own land in various states, you will be safe where tax thresholds apply. It's advisable to spread your investments and benefit from flexible thresholds. Also, it helps if you choose to acquire land under different entities or names. A husband can decide to use his spouse's name for a different purchase instead of using his name. Before you try these tax reduction tactics, be sure to consult a tax specialist at Whichmortgage.ca.