Tax Avoidance & Tax Evasion

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                     Every assessee wants to escape from paying taxes which encourages them to use various means to avoid such payment. And when its about savings if taxes, the two most common practices that can be seen all around the world are tax avoidance & tax evasion.


  Comparison Chart

BASIS FOR COMPARISONTAX AVOIDANCETAX EVASION

  1. Meaning
Minimization of tax liability, by taking such means which do not violate the tax rules, is Tax Avoidance.Reducing tax liability by using illegal ways is known as Tax Evasion.
2.What is it?Hedging of taxConcealment of tax
3.AttributesImmoral in nature, which involves bending the law without breaking it.Illegal and objectionable, both in script and moral.
4.ConceptTaking unfair advantage of the shortcomings in the tax laws.Deliberate manipulations in accounts resulting in fraud.
5.Legal implicationUse of Justified meansUse of such means that are forbidden by law
6.Happened whenBefore the occurrence of tax liability.After tax liability arises.
7.Type of actLegalCriminal
8.ConsequencesDeferment of tax liabilityPenalty or imprisonment
9.Objective






To reduce tax liability by applying the script of law.To reduce tax liability by exercising unfair means








Comments

  1. Chetna SharmaAugust 20, 2019 at 3:57 AM

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