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At its simplest, tax planning is just a case of arranging your financial affairs in such a way as to pay as little tax as possible within the law and so not much different from “tax avoidance”.

Politicians and the media are struggling to agree exactly what “tax avoidance” is and are starting to use terms like “unacceptable tax avoidance”, “aggressive tax avoidance” or even “immoral tax avoidance”. It seems that “tax avoidance” is no longer an acceptable term so perhaps we should be define the term  “tax planning” as “acceptable tax avoidance”.

Tax planning is nothing new. It has existed for as long as governments have imposed taxes and in doing so built in allowances and reliefs designed to reduce, in specific circumstances, the tax bills of taxpayers.

The fact is that it is perfectly possible for individuals and companies, openly and legitimately, to take advantage of a whole range of tax planning opportunities not only to reduce their tax bills, but also to ensure that they comply with national and international regulations, improve cash flow, and build their business or wealth in a sustainable and legal way.

That’s tax planning.

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  1. What is Tax Planning? | greatbizinfo - February 27, 2014

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