NuWireInvestor issued an interesting piece this morning on rental income tax rates around the world. Research came from the Global Property Guide study and rates were based on the monthly rental income of $1500.
Among the highest rates were Switzerland (48.56%), Tanzania (31.45%), Russia (30%), U.S.(30%), Costa Rica (30%), Kenya (30%), Norway (26.86%), Philippines (25%), Peru (24%) and Spain (24%).
Higher rental income taxes can potentially decrease property values and the interest of foreign investors unless significant deductions are offered to offset the rate. Obviously, the lower tax rates create more profit and are considered more attractive to investors.
Our neighbors? Canadas rental income tax rate is 14.87% and Mexicos is one of the lowest at 3.36%. For those exploring the idea of an investment, remember the US does tax foreign income so talk to a tax professional before making any commitments!