People Earning More than 5 Crore Don’t Pay Tax
There are 2 kind of people. One are High Income group of people. These are the people who earn a lot but can accumulate less in wealth. This is because they realize all of the Income and that’s why they have to pay lots of money in the tax. Doctors, Lawyers, Sports stars & IT Professionals fall under this category.
While the other kind of people are low income but high accumulator of wealth. This is because they realize less in income and more in Capital Gains (Unrealized Income). These are the true rich people. This is because they earn in the Capital Gains. And that’s why they don’t have to pay any Tax on their Capital Gains because it is unrealized Income.
Many rich people are earning literally more than 5 crore every year but even though they don’t pay anything in tax and that is also legally. This is because all of their Income is unrealized Income. These people earn everything in their Investments and that’s why they don’t have to pay anything in taxes.
While High Income group of people have to realize everything they earn and that’s why even though they earn just 1 crore every year, they have to pay 30 lakh tax. Because they realize everything they earn.
If you want to save tax than you have to earn in the Investments. This is the only key of protecting your wealth from the Tax.