Income
Income is the money an individual or business receives in exchange for providing a good or service or through investing capital
Income is the money an individual or business receives in exchange for providing a good or service or through investing capital
Income can be divided into two primary categories: earned and unearned income.
This is the income received in direct exchange for work, including salaries, wages, tips, commissions, and income from self-employment.
Unearned income is money received without a direct link to employment or business activity. It includes interest from savings, dividends from investments, rental income, and royalties.
The main features of income include its regularity and dependence on one's work or business activities. Income is often subject to taxation, the rates of which may depend on the total amount and source.
Income is generally received in exchange for goods, services, or work, while capital gains arise from the successful selling of investments or assets.
In many regions, income is subject to a higher tax rate than long-term capital gains, making the latter more tax-efficient.
Income is typically received on a regular basis, such as weekly or monthly, while capital gains are realized only when assets are sold.
Income generation is often perceived as lower risk but provides a steady stream of funds. Capital gains, however, may carry higher risk with the potential for higher rewards.
These are typically taxed at a person's income tax rate based on their tax bracket.
Please note that depending on the Jurisdiction some of these examples might not be considered income.
