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difference between tax avoidance vs tax evasion

Avatar 37a3bd7bc7328f0ead2c0f6f635dddf60615e676e6b4ddf964144012e529de45 pranesh asked about 3 years ago

difference between tax avoidance vs tax evasion

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Avatar 37a3bd7bc7328f0ead2c0f6f635dddf60615e676e6b4ddf964144012e529de45 narahari answered almost 3 years ago

Tax evasion, on the other hand, is the illegal practice of not paying taxes, by not reporting income, reporting expenses not legally allowed, or by not paying taxes owed.Hence, tax evasion is illegal and unethical. It is uneconomical as well. In other words a person is going and bypasses the enacted law which leads to negative consequences.

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Open uri20170510 32134 1nqu8aj?1494421649 sowmya answered about 3 years ago

Hai THE DIFFERENCE BETWEEN ‘TAX AVOIDACNE’ AND ‘TAX EVASION’ is TAX AVOIDANCE (i) Where the payment of tax is avoided though by complying with the provisions of law but defeating the intension of the law is known as tax Avoidance. (ii) Tax Avoidance is undertaken by taking advantage of loop holes in law (iii) Tax Avoidance is done through not malafied intention but complying the provision of law. (iv) Tax Avoidance looks like a tax planning and is done before the tax liability arises. TAX EVASION 1. Where the payment of tax is avoided through illegal means or fraud is termed as tax evasion. 2 .Tax evasion is undertaken by employing unfair means 3. Tax Evasion is an unlawful way of paying tax and defaulter may punished. 4. Tax evasion is blatant fraud and is done after the tax liability has arisen.

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Avatar 37a3bd7bc7328f0ead2c0f6f635dddf60615e676e6b4ddf964144012e529de45 lochan answered about 3 years ago

**DIFFERENCE BETWEEN TAX AVOIDANCE AND TAX EVASION** TAx avoidance is legally lessening your taxes using legally approved methods Tax evasion is illegally not paying tax In tax avoidance taxes are avoided by taking all legal deductions and by other means. It is done by not reporting income, reporting expenses not legally allowed, or by not paying taxes . Tax avoidance means taking advantage of the loopholes in the taxation system to reduce the burden of tax. Tax evasion is breaking the law and not paying the taxes. Thanks

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Open uri20170510 32134 6sj6lc?1494421796 Tushar Sampat answered about 3 years ago

**The main difference between Tax avoidance and tax evasion** --------------------------------------------------------- Tax avoidance is the legitimate minimizing of taxes, using methods approved by the IRS , tax avoidance means traveling within framework of the law or acting as per language of the law only in form, but murdering the very spirit of the law and defeating the purpose of the particular legal enactment.. Businesses avoid taxes by taking all legitimate deductions and by sheltering income from taxes by setting up employee retirement plans and other means, all legal and under the Internal Revenue Code or state tax codes.In other words it means making use of the law for self benfit and thereby saving tax. Tax evasion, on the other hand, is the illegal practice of not paying taxes, by not reporting income, reporting expenses not legally allowed, or by not paying taxes owed.Hence, tax evasion is illegal and unethical. It is uneconomical as well. In other words a person is going and bypasses the enacted law which leads to negative consequences. Tax evasion is most commonly thought of in relation to income taxes, but tax evasion can be practiced by businesses on state sales taxes and on employment taxes. In fact, tax evasion can be practiced on all the taxes a business owes.This are main differences of tax avoidance and tax evasion.

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