Paying tax is one of the most important duties of a citizen who is responsible towards its national growth and prosperity. In order to be an efficient taxpayer, one needs to maintain a proper tax planning and contribute to nation building. But the challenge which every single person face is inadequate knowledge regarding tax building. MoneyMindz, India’s First On Call Advisory Portal comes up with a solution to this major problem with the introduction of Kuber Mindz, Best Interactive Financial Advisor. The Latest Financial Advisor, Kuber Mindz helps you with best tax planning making you a smart taxpayer. You can directly, communicate with Kuber Mindz without even spending a penny at your best comfort, just at your fingertips and attain the required financial guidance.
It is very imperative to educate the people regarding the importance of tax compliance. Paying taxes is mandatory and every person shall be well aware of it. A proper Tax Planning is a way by which one can arrange his/her financial affairs in such a manner that without breaking up any law one can take full advantage of all exemptions, deductions, rebate and reliefs allowed by law so that tax liability will be reduced. For the benefits of economy and society, the government provides deductions, exemptions, reliefs or rebates to every citizen.
Objectives of Tax Planning:
1. Reduction of Tax Liability: Within the framework of the statue an assessee can save the maximum amount of tax by properly arranging his/her operations as per the requirements.
2. Minimization of Litigation: Taxpayers and tax collectors are standing against each other as the former wants the tax liability to be minimized while the later attempts to extract the maximum. As a result, a proper tax planning is needed to aim at conforming to the provisions of the tax law, in such a manner that incidence of litigation is minimized.
3. Productive Investment: This is one of the major objectives of tax planning. It aims at channelizing of taxable income to different investment plans. Basically, it helps at the optimum utilization of resources for productive causes and relieving the assessee from tax liability.
4. Health Growth of Economy: Based on the growth of the citizens, development of the economy can be ascertained. Tax planning measures involve generating white money that flows freely and results in the sound progress of the economy.
5. Economic Stability: Economic stability can be brought by proper tax planning using various techniques such as mobilizing resources for national projects or availing ways for investments that are productive in nature.
Various Types of Tax Planning:
1. Short-range and long-range Tax Planning: The tax planning that is made every year in order to arrive at specific or limited objectives is called short-range tax planning. Conversely, long-range tax planning implies to such practices undertaken by the assessee that are not paid off immediately.
2. Permissive Tax Planning: The tax planning which is made as per expressed provision of the taxation laws is termed as permissive tax planning.
3. Purposive Tax Planning: This tax planning refers to the tax planning method that misleads the law. There is no expressed provision of the statue under this type of tax planning.
5 Golden Rules of Tax Planning:
1. Spreading the taxable income among various members of your family.
2. Taking full advantage of tax exemptions available under law.
3. Taking full advantage of permissible tax deductions and rebates available on stipulated tax-savings investments.
4. Making optimum use of tax-exempted incomes and
5. Make simple tax planning as it is a smart tax planning.
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