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What are objectives of tax planning and various types of tax planning?
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∙ 11y ago
Tax planning means managing the finances of a person, organization, or businessmen. The main purpose of tax planning is to manage your income so that you can do savings for a stable future. This process has a lot of benefits like helps you in increasing your economic growth, reduction of tax liability, minimization of litigation, productive investment, and so on. A good firm will provide you tax planning services to help you in managing your taxes.
You should not be required to pay more in tax than you deserve. You can take advantage of different strategies, credits, and deductions that you are entitled to and also adhere to tax planning strategies. Some of the objectives are:
1. Tax planning reduces the risk of loss in financial status.
2. Tax planning avoids every possibility of litigation.
3. A business can grow when it is financially planned and managed. So, for business growth, you need tax planning.
4. Tax planning includes timely payments of taxes so it helps in economic stability.
5. The main aim is to use productive investment planning to come up with the most beneficial tax saving options.
Here are the three types of tax planning:
1. Purposive Tax planning
2. Permissive tax planning
3. Long-range and Short-range tax planning
Purposive Tax planning: Purposive tax planning means intellectually applying tax provisions to avail the tax benefits. It includes tax planning with the purpose of getting the maximum benefit.
Permissive tax planning: Permissive tax planning refers to the plans which are permissible under various provisions of the law, for example, planning of earning income planning of taking advantage of various deductions, incentives for getting the benefit of different tax concessions, etc. In other words, it means planning made as per the provision of the taxation laws.
Long-range and Short-range tax planning: Short-range planning means planning made annually to fulfill the limited or specific objectives. Long-range tax planning refers to the practices undertaken by the assessee. Long term planning is done at the beginning of the income year to be followed around the year. Long term planning does not help immediately, for example, transfer of assets without consideration to a minor child.
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What are the various types of tax planning?
One is hiring someone to do it for you which I recommend
What are the objectives and importance of tax planning?
It optimizes how you pay taxes. It will put your money where it actually belongs
What are the objective of tax planning?
the following are the important objectives of Tax planning. 1. Reduction of Tax liability 2. Minimisation of litigation 3. Productive investment 4. healthy growth of economy 5. Economic stability
What is the Nature and scope of tax planning?
tax planning means how we make the plan for tax. we have toreduce the tax from our business & increase the profit as well.... are called tax planning.
Difference between the tax planning and tax avoidance?
Tax planning is legal while tax avoidance will get you into a lot of trouble
What are the various types of tax planning?
One is hiring someone to do it for you which I recommend
What are the objectives and importance of tax planning?
It optimizes how you pay taxes. It will put your money where it actually belongs
What are Objectives of tax planning?
the following are the important objectives of Tax planning. 1. Reduction of Tax liability 2. Minimisation of litigation 3. Productive investment 4. healthy growth of economy 5. Economic stability
What are the objective of tax planning?
the following are the important objectives of Tax planning. 1. Reduction of Tax liability 2. Minimisation of litigation 3. Productive investment 4. healthy growth of economy 5. Economic stability
Explain capital structure related to text planning in details describe the objectives of tax planning?
Capital structure which aims at the maximization of profits. It is related to text planning in that planning help evaluate the the theories of capital structure.
What is a statutory exemption?
An exemption is something that is excluded. In taxes, there are various tax exemptions and types of income that are exempt from tax. There are also certain types of organizations that are exempt from tax.
What is the difference between tax planning and tax management?
1.tax planning is a wider term and tax management is narrow term which is a part of tax planning. 2.tax planning emphasizes on tax minimization whereas, tax management is compliance of legal formalities . 3.every person does not requires tax planning but tax management is essential for everyone. 4.tax planning is about future benefits and tax management is about present benefits.
What is the Nature and scope of tax planning?
tax planning means how we make the plan for tax. we have toreduce the tax from our business & increase the profit as well.... are called tax planning.
Difference between the tax planning and tax avoidance?
Tax planning is legal while tax avoidance will get you into a lot of trouble
Where to go for tax planning?
Most local community colleges offer some courses in tax planning depending upon where you are physically located. The IRS also has detailed instructions and publications about various tax topics from the IRS.gov website. Most universities and colleges offer accounting and tax related courses as well.
What is the difference between corporate planning and tax planning?
Corporate planning is planning made for your business while tax planning is minimizing the taxes you pay in a legal manner
What is the difference between tax planning and budget planning?
Tax Planning is the method of reducing tax liability through legally accepted devices whereas budget planning is managingincome and expenditure of a person or organization.
