Which of the following are true in tax planning ? (i) It is futuristic in its approach. (ii) It has…
Tax planning is (i) futuristic and forward-looking in its approach, and (iv) its primary objective is to legitimately minimize tax liability by availing statutory…
Choose your answer
Which of the following are true in tax planning ?
(i) It is futuristic in its approach.
(ii) It has limited scope compared to tax management.
(iii) The benefits arising from it are limited particularly in the short run.
(iv) Its main objective is to reduce the tax liability.
Answer and explanation
Correct answer C
Tax planning is (i) futuristic and forward-looking in its approach, and (iv) its primary objective is to legitimately minimize tax liability by availing statutory exemptions, deductions, and rebates. Unlike tax management, tax planning has a wider scope and provides both short-run and long-run benefits. Thus, '(i) and (iv)' is correct.
Practice for these exams
-
UGC NET Commerce