Pearl Business Services

Just as every businessman tries to maximize his profits by reducing the cost, he should also arrange his affairs in such a way, that he pays the least amount of tax. Thus. The primary objective of tax planning is to save the hard labour of the taxpayer in enjoying the fruits of his income and wealth to the maximum possible extent.

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Tax planning is the arrangement of financial activities in such a way that maximum tax benefits are enjoyed by making use of all beneficial provisions in the tax laws, it entitles the assessee to avail certain exemption, deduction, rebates, and reliefs, to minimize his tax liability, this is permitted and not frowned upon.

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It is duty of the individual to save legally from payment of taxes so that the same may be available with him to make him and his dependants to be good and honourable citizens, on the other hand, the practical concept of taxation laws is to realise the revenue by way of tax to the maximum, therefore, the perceptions of the taxpayer and the least collector are different, the taxpayer spares no efforts in maximising his profits and attracting the least incidence, the tax-collector, on the other hand, tries to maximise revenue within the framework of the law. It is here that tax planning has assumed far-reaching importance in the confounding complexities of the taxation laws.

Benefits of Tax Planning:

1. Reduction of Tax Liability

2. Minimisation of Litigation

3. Productive Investment

4. Healthy Growth of economy

5. Economic Stability