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Commerce · Q560

Income Tax and Corporate Tax

Graduate and Post Graduate · Commerce · question 560

Q560

X is an individual. For the assessment year 2012-13 his gross total income is Rs. 3,40,000. Tax on it is Rs. 16,480. To reduce his tax liability, he deposits Rs. 50,000 in public provident fund account. Consequently, his taxable income and tax liability will be reduced to Rs. 1,10,000 and Rs. 11,330 respectively.

A.
Tax evasion
B.
Tax planning
Answer
C.
Tax avoidance
D.
Tax management

Answer: Option B

Solution

Answer: Option B
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