TAX PLANNING IN PAKISTAN
A tax is a fee or money charged by government fix rates on various services delivered by the people. Tax planning is a basic legal path for reducing tax responsibilities. In short tax planning is a well planned practice which takes place within the area of law to reduce the tax dues with the fundamental use of available freedom, discount and other grants for tax deduction. Taxes are expenditure that government needs to serve the people. Pakistan performs the taxes through combined system but federal board collects taxes on the goods. The FBR (Federal board world) Income officials declare that their system is very organized and effective but business communities thought that this system takes taxes forcefully or by threats. Different investigations thought are an auto mode system. Every new government tries to turn the FBR but the end result ck square to zero.
The problems facing tax administrations:
Why FBR not succeed in register the growth as percentage of GDP, what are the faults in taxation system in Pakistan, what is the best planning of taxation in the world and how can we implant best tax planning in Pakistan.
What you should know about tax planning
Taxation influences every common man in Pakistan in every single aspect of life. Whether you buy a car, a property, build your home, starting a business or even changing your job, you have to be pay taxes, governed by the FBR Pakistan. This the point where a wrong decision can cause you in disaster, but it can easily manage through taxation planning. As FBR change taxation planning every year so, we should update tax planning through FBR website. People from every class afraid to tax laws. Therefore every person should take help provided by government facilitation booths in major cities of Pakistan. Due to the lack of knowledge, even educated people waste a big amount of their money on hiring the tax lawyers and firms without knowing the declaration of their taxes. Therefore, you should take help from tax authorities with trust and faith.
Tax planning in USA
Tax planning is arrangements of financial situations to reduce the tax dues in legal manners. Tax rules can be complex, it take some time to understand the tax rules but It will give you benefit. Does not fall into misunderstanding that taxes are only for rich people or for who has mega successful business. Tax planning is a good path to increase the income by reducing the tax dues. It does not matter whether you are a resident of US or owner of the international business tax planning will benefit to you and your business
Goals for tax planning
The main cause of the tax planning is to minimize the taxes on the income. Here are some methods of tax planning in USA.
Start tax planning
The first most important thing before understanding the tax planning you should know in which bracket of tax you fall. The people of USA have higher income subject to higher tax rate but with lower income give lower tax rates. There are seven tax rates on income are 10%, 12%, 22%, 24%, 32%, 35% and 37%
Tax deduction and tax credits
Tax deduction and tax credits are important terms in tax planning to know
Tax deduction is a specific amount of tax dues t lowers your taxable income to the government. Tax deduction is more expenses because it decreases the amount by indirect method. It reduces the tax dues but also reduce your taxable income. To choose the tax deduction and credits can be risky and fall you in difficulty. Tax professionals can help you in choosing which is best tax deduction or tax credits or both
Tax credits are better than tax credits because it directly reduce your tax income. Tax credits reduce the amount of tax dollar for dollar. The tax credit reduces the actual amount of the tax. A tax credit may be refundable or non refundable. Both can reduce your tax dues. But there is a benefit of refundable tax credits, if you have left over amount in refundable credit after the tax dues your amount will be refund t you