When most people think about jewellery they hey often see it as a means of flaunting wealth . However many people are unaware of certain benefits of owning/buying jewellery. In this case we’re talking about the tax benefits of owning jewellery.
Tax benefits of owning jewellery
Tax Deduction
Jewellery can qualify for a tax deduction when it serves as a legitimate business expense. This scenario often applies to individuals in the entertainment industry who can categorize their jewellery as part of their costumes. In the entertainment world, jewellery is not just about flaunting wealth. It’s an important part of personal brands and attracting attention, which can lead to lucrative opportunities.
Inheritance
Unlike assets like real estate, stocks, or cash, jewellery can be seamlessly transferred across generations without the burden of taxation. This ensures that the value of your investment remains intact when it is inherited. Furthermore, jewellery typically appreciates in value over time and often beats inflation. While it may not consistently match the investment potential of properties or stocks, in numerous scenarios, passing down jewellery could prove to be a more favourable choice than other investment options.
Selling Your Jewellery
Owning jewellery offers not only tax advantages but also benefits if you decide to sell it. Unlike houses, jewellery is classified as personal property, exempting you from capital gains tax when sold. However, jewellery is often sold at a loss, so for most people, this wouldn’t be a concern. On the contrary, luxury watches are typically sold at a profit, making the absence of capital gains tax a substantial tax advantage for watch owners
While purchasing jewellery may not always be the best financial decision, there are often overlooked financial advantages associated with it. This article provides an overview of some of these benefits. Nevertheless, it is important to conduct thorough research or consult with a financial advisor before making any decisions.