Huge amount of trouble, little amount of “Tax Evasion”
We in daily life hear some words like “Tax planning” and “Tax evasion”. But due to the lack of awareness or I should say knowledge of tax provisions of the country involve in tax evasion activities and think that we are planning our tax liability. But you must be aware that these two words have a huge difference. In simple words, if I define tax planning I would say tax planning means reducing tax liability by taking advantage of the benefits provided by the various provision of the tax act, in this we comply with the requirement of the provisions of the tax act. For example, as per section 1(12) of schedule 1 of the Income Tax Act, 2058 if we take a life insurance policy and pay a premium then we are allowed to deduct up to Rs. 40,000/- to arrive at taxable income. On the other hand, if we try to reduce tax liabilities by claiming those benefits which are not available in the tax act itself then it is tax evasion. For example, the provision of section 1(12) of Schedule