Tax Planning: Is there any Legal and Moral Benefit?

Wednesday, February 14, 2018/ 1:32PM /Deloitte


Business owners constantly seek avenues to eliminate unnecessary and avoidable costs with the aim of optimising profits. Thus, efficient business practices become paramount in minimizing expenses, the most worrisome being “tax expense”.


In a bid to achieve business efficiency and minimise tax spend, companies engage in tax planning activities. Unlike its counterparts (tax avoidance and evasion), which are ladened with non-disclosure, sham transactions, fraud and concealment, tax planning involves efficient arrangement of financial affairs (within the precincts of extant laws) to reduce tax liability.


Tax planning schemes have been generally regarded as acceptable. However, today, some tax planning activities are deemed to have crossed acceptable limits and are termed aggressive. Such aggressive planning are in many cases, likened to tax avoidance procedures used by taxpayers to gain strategic advantage.


Proponents of tax planning schemes, aggressive or

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