The Capital Gains Blog

Archive for the ‘Capital Gains Income’ Category

Willis Lease Finance Reports 2009 Net Income of $22.4 Million

NOVATO, Calif. — Willis Lease Finance Corporation , a leading lessor of commercial jet engines, today reported strong revenues, net income and earnings per share in 2009, reflecting continued growth in its lease portfolio, higher maintenance reserve revenues and lower borrowing costs.

Capital Gains and Income Tax in Dental Transitions

The basic requirements to set up a company, incorporation procedure, time-line and statutory compliance are some of the factors that need to be taken into account while determining the ease of setting up a company in a given jurisdiction. This article presented by www.guidemesingapore.com contrasts the company registration and related statutory requirements for two of the major countries in Asia namely Singapore and India.

FOREIGN OWNERSHIP
Singapore does not impose any restrictions on foreigners who wish to do business in the country. It allows 100% foreign ownership (i.e. shareholding) of a Singapore private limited company. Any foreign individual or a foreign entity can register a company in Singapore. No special approvals or formalities are required and the new entity can engage in any lawful business activity.
In India, foreign entrepreneurs can set up a foreign direct investment company with 100% ownership only in certain business sectors. Some sectors are subject to caps on investment limits and require prior approval from the Indian government, while certain other sectors prohibit foreign investment.

MINIMUM INCORPORATION REQUIREMENTS
In Singapore, the minimum incorporation requirements include: a local registered address; at least 1 local resident director (a Singapore Citizen, a Singapore PR, or a foreigner holding an Employment Pass, Entrepreneur Pass or Dependent Pass); a local resident and qualified company secretary (must be a natural person); a minimum of 1 and maximum of 50 shareholders (natural persons or corporates); and a minimum paid up capital of SGD 1.
To set up a company in India, foreigners must comply with the following requirements: a local registered address; at least 2 directors (need not be local residents); minimum of 2 and maximum of 50 shareholders (natural persons or corporates); and a minimum paid up capital of INR 100,000.
INCORPORATION PROCEDURE
Company registration in Singapore is fully-computerized and can be completed within 1 day via electronic means. There are only two major steps involved in company formation – name approval and filing incorporation documents.
On the other hand, incorporating a company in India involves several steps and is not only tedious but also time-consuming. It can take up to few months to complete all formalities. You must first seek government approval for setting up a foreign direct investment company in India. Directors must obtain a ‘Director Identification Number’ and ‘Digital Signature Certificate’ prior to company incorporation. Upon company name approval and filing incorporation documents, the Certificate of Incorporation will be issued.

INCORPORATION TIMELINE
Company incorporation in Singapore can be completed in a record time of less than 24 hours, with minimal formalities. By contrast, in India it can take anywhere between 2-3 months to incorporate a company.
ANNUAL FILING REQUIREMENTS
In Singapore, an Annual Return must be filed with Companies Registrar and Income Tax Return with the Singapore tax department each year. Small companies with revenue less than SGD 5 million and no corporate shareholders are exempt from filing audited accounts with the returns.
In India, companies must submit Annual Return along with audited annual accounts to the Registrar of Companies. No company is exempt from the audit requirement. Income Tax Return along with audited accounts must be filed with the Indian tax authority each year. Companies whose annual turnover is less than INR 4 million are exempt from the tax audit requirement.
CORPORATE TAXES

The corporate tax rate in India is 30.9% for taxable income up to INR 10 million and 33.9% for taxable income above INR 10 million. Companies are also subject to dividend distribution tax of 16.995% and Capital Gains Tax of 10%, 15% or 20%. Services tax stands at 10.3%. The state level VAT ranges from 1%, 4%, 12.5% to 20%, while the central level sales tax stands at 2%.
Taxes in Singapore are significantly lower than India. Singapore charges a corporate tax rate of approximately 8.5% for profits up to S$300K and a flat 17% for profits above S$300K. There is neither a separate dividend distribution tax nor any capital gains tax. GST stands at 7%.
According to a recent tax comparison report issued by GuideMeSingapore.com that considers the case of a hypothetical start-up firm expecting to make an annual income of US$300k, the firm will have a total tax bill of only US$34k in Singapore while it would face an approximate tax bill of US$102k in India.
ON A FINAL NOTE
Based on the comparative analysis it is clear that Singapore offers a better business environment for foreign entrepreneurs, as compared to India. Some of the distinct characteristics of company formation in Singapore include: easy incorporation procedure which can be completed in less than 24 hours; liberal foreign ownership policy; minimal statutory requirements and an attractive tax regime.

Bubble Up vs Trickle Down Economics

Which is better for the U.S. economy: Trickle Down or Bubble Up Economics?

How To Do Internet Marketing

Question: Is the tax rate higher for income or capital gains?

I’ve already accumulated about $45,000 in short term capital gains this year. I need to liquidate another $40,000 in stocks or sell part of an inherited IRA which, as I understand, will be taxed as income. Is the tax hit going to be the same either way?

Last year I had taxable income of about $53,000 with next to no capital gains. This year I expect about the same taxable income plus the capital gains.

Answer: Short term cap gains are taxed as ordinary income. LT gains are at a 15% rate, but that is set to expire in a few years (irrelevant to you). BTW, how did you get those kinds of gains? Time to share, LOL!

(AFX UK Focus) 2010-01-06 05:34 HK, China stocks gain; exporters, energy rise

By Jun Ebias and Claire Zhang

Smart Tips on Capital Gains

Question: If our Government values workers over the lazy why tax wage income at a much higher rate than passive income?

Like the conservative bid to get rid of the Estate Tax (now called the Death Tax) for Eatses over 2.6 million, like dividen income or capital gains over wage income.
Braman: hey I was in Michigan
Ned S. Thank you for your answer! Russia is Capitalist but its awful there are a very few very very rich and everyone else is working poor

Answer: The Government would go broke. That is why the
Federal Income Tax NEEDS to be reformed and fast.

Campbell says goodbye to 2009

Campbell made headlines this past year with the appointment of its newest mayor. The Campbell City Council Chamber wasn’t big enough to hold the gathering of family and friends wanting to catch a glimpse of history Evan Low was about to take the mayor’s seat. In a standing-room-only chamber with people pouring out the doors, a gallery of news cameras zeroed in on Low when the Campbell City …

The TIC 1031 Opportunity

Question: I’d never have to pay Social Security or Medicare tax if I made my living off investments and capital gains?

Would that annual income (from non-earned income) nonetheless be used in figuring the amount of Social Security and Medicare I’d get after I retire?
I’m in my early 50’s. I have been paying Social Security and Medicare.
I’m asking if I “retired” now and just sold off my properties for capital gains, if I’d not have to pay on those gains, if those gains were my entire income each year.
I’m talking about real estate, not selling off my IRA early. I have paid soc. sec. for over like a thirty-plus year period.
To complicate matters, I paid exclusively into teacher retirement for several years also.

Answer: Nope! If that was your entire income for your lifetime, you’d get exactly $0 from Social Security. You would be completely ineligible for ANY Social Security benefits whatsoever.

And ignore the “engineer”. He knows nothing about tax or SS rules. Investment income is NOT earned income and is NOT subject to Self-Employment tax.

Addendum: If you have paid into the SS system enough to be considered fully eligible (basically 10 years of full employment) you’ll get something when you retire. However, unearned income such as dividends, interest, capital gains, rents and royalties, etc. are not subject to SS taxes and are NOT used in calculating your SS benefits, either for retirement OR for disability. It doesn’t matter when you received the unearned income, it won’t be used to deternime your benefits.

More info: What you MIGHT be able to do is to form a corporation that acts as a holding company for your investments. Pay yourself a salary out of the investment income. That salary will be subject to Social Security and Medicare taxes as well as income tax withholdings. You’ll also have to pay some in federal and state unemployment taxes but it will allow you to continue to pay into the SS system and that way the income you earn will be considered in calculating your SS benefits. Consult with a qualified tax advisor on this aspect. I don’t do much with corporate returns and it wouldn’t surprise me if there are some rules that would limit this angle but it would be worth considering, especially if you’re looking at a lot of income that would otherwise not be used in the calculation of your benefits. Just a thought.

IRS revises tax guide website

The Internal Revenue Service said taxpayers can get the most out of new recovery tax breaks and get a jump on preparing their 2009 income tax returns by consulting a newly revised, comprehensive tax guide now available on www.irs.gov.

Obamanomics: A Recipe for Disaster!