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5 Monetary Benefits That Compel You To Buy Agricultural Land

buy agricultural land and get more benefits

Monetary benefits will surely encourage you to buy agricultural land. Agriculture is vast but if you know how it works, then you can make a huge amount of money in a short period of time.

Even if you are leasing your land to a farmer, you should be aware of what he is doing. To improve efficiency, you have to give inputs to him. For that, you should definitely know farming techniques. Organic agriculture is proven to be successful.

The tax benefits you get from agriculture are attractive and beneficial. Land leasing, financing and flipping are some of the best practices you can follow and be successful.

In this blog post, we are going to discuss the key monetary benefits of buying agriculture land.

1. You can do Farming and Earn money

do farming and earn money buy agricultural land

There is a reason why this point is at the top. The best way to make money from agriculture property is to do Agriculture. You have to cultivate, process, and export.

Is it possible to do farming without sufficient knowledge?

This is the first question that pops up when I said “Do Agriculture”. Agriculture is not easy and quick. It takes time. You have to learn the basics and techniques of farming and implement it properly.

You can’t do farming just because you have organic agriculture land and money to run the business. Learn, Implement, Excel. That’s the key for running agriculture as a successful business

2. Tax benefits of Buying Agricultural Land

Tax benefits gained from buying and selling agricultural land is enormous. Let’s say you buy agricultural land in Telangana at X price. This won’t be considered as a capital asset. So that means, you need not pay income tax for any revenue you generate from that piece of land.

You need to meet the clause in Section 54B in order to get tax exemption from Capital Gains. In rural areas, you need not pay capital gains tax for agricultural land. But in urban areas, you need to pay tax ranging from 20-30%.

You can also get a waiver for crops, subsidies, loans, and more benefits from agriculture. Agriculture land laws vary from state to state. So you need to understand the laws and how it works in your state.

For example, you need not be a farmer to buy agriculture land in Telangana. On the contrary, you have to be a farmer in Karnataka to own agricultural land.

3. Sale of Agricultural land at a higher price

Sale of Agricultural land at a higher price

Buy agricultural land at a low price and sell it at a higher price. Sounds easy, right? Actually, it’s not as easy as it sounds. You need to analyse a property before buying it. If you buy land at a low price with good development potential, then all you need to do is wait.

Wait for the right time and demand. You get the opportunity to fix the price as you wish. That’s the magic of buying a good agricultural property.

What do I mean by good agricultural property?

  • Located in a place which is transport-friendly and climate-friendly.
  • The land should have good development potential.
  • The land should be free of legal issues.
  • Water, this is the most important thing in agriculture. An abundant water source should be available near the land.

4. Financing for Agricultural Land

Assurance is the key to investment. That’s what you get when you lend money to someone who is going to buy agriculture land. Let’s say you are going to give X amount of money to Ranveer. He is going to buy agriculture land using that money.

Things you get in return:

  1. You get interest for the money lent on a monthly basis.
  2. There is no way you are going to lose money. Even if he doesn’t pay the EMI properly, you can seize the land and make it yours.

Interest and Guarantee, what else do you need?

Also, there is another way you can earn money. To run the agriculture business, farmers and landowners need capital. You can lend money to them and get interest on a monthly basis.

5. Agricultural Land Leasing

Agricultural Land Leasing

Leasing of agriculture land works as per state laws. In some states, you can lease your farmland but you can’t lease in other states. Instead of you doing all the farming activities, you can lease your land to someone who is an expert in farming.

The agreement depends on the owner, lessee and state laws. Some owners prefer profit-sharing, some prefer to rent and it completely depends on the mutual agreement.

Conclusion

If you have a basic knowledge of farming, it will be really helpful to run agriculture as a business. Also, be aware of laws pertaining to agriculture land, leasing, etc. Tax benefits are extremely important because they reduce your financial burden to a great extent.

If you are struggling to proceed further, I would suggest you consult agencies who have vast experience in agriculture. They can guide you and make you successful.

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