Achieving 0 taxability

[Mohur]

I have been researching on how to minimize taxes.

People of big companies take 0 salary but opt for company shares. This they have 0 tax liability. Then they take loan from bank in exchange of those shares.

I run as sole proprietorship (no company), so there are no shares involved. Even if I own a company, which bank will give loan for a company earning few thousand dollar per month.

I know

Income - expenses = taxable income

Either we make income 0 or make expenses equal to income. In my case, I can spend money on office stuff, furniture, content, domain, hosting, software, courses, computer hardware, car, camera etc. My CA always tell me to show more expenses. How do I show expenses without actually making expenses.

Even with good amount of expenses, there will be tax to be paid (which is calculated at 30%+ of taxable income)

Please suggest ideas how we can minimize taxes.

 

[Predator]

even after claiming all the expenses, using every exemption, and all regular tricks like paying rent to parents, etc., you still have tax to pay and wish to save it, you need to go dirty then.

 

[Souvik]

I have been researching on how to minimize taxes.

People of big companies take 0 salary but opt for company shares. This they have 0 tax liability. Then they take loan from bank in exchange of those shares.

I run as sole proprietorship (no company), so there are no shares involved. Even if I own a company, which bank will give loan for a company earning few thousand dollar per month.

I know

Income - expenses = taxable income

Either we make income 0 or make expenses equal to income. In my case, I can spend money on office stuff, furniture, content, domain, hosting, software, courses, computer hardware, car, camera etc. My CA always tell me to show more expenses. How do I show expenses without actually making expenses.

Even with good amount of expenses, there will be tax to be paid (which is calculated at 30%+ of taxable income)

Please suggest ideas how we can minimize taxes.

You either lower taxes by showing more expenses, or lesser incomes. Out of the book sales, reduced quantity sales, fictitious expenses etc. Depends upon your turnover. Car depreciation etc. Return of goods sold.

 

[Rishabh]

I wish if such adjustments of expenses (household one in this case) against income shall be provided to Salaried class as well who pay the tax even before receiving the income and have very limited options to get exemptions. 🙂

 

[ltf4ever]

I have been researching on how to minimize taxes.

People of big companies take 0 salary but opt for company shares. This they have 0 tax liability. Then they take loan from bank in exchange of those shares.

I run as sole proprietorship (no company), so there are no shares involved. Even if I own a company, which bank will give loan for a company earning few thousand dollar per month.

I know

Income - expenses = taxable income

Either we make income 0 or make expenses equal to income. In my case, I can spend money on office stuff, furniture, content, domain, hosting, software, courses, computer hardware, car, camera etc. My CA always tell me to show more expenses. How do I show expenses without actually making expenses.

Even with good amount of expenses, there will be tax to be paid (which is calculated at 30%+ of taxable income)

Please suggest ideas how we can minimize taxes.

if it is a family business and your family members help you out, you can officially employ them and count their salary aa expenses. the salary should be less than tax slab so that even they don't pay income tax. this is one of the cleanest way without any manipulation. i think your CA will be the best one to advise you out in such matters.

 

[Souvik]

I wish if such adjustments of expenses (household one in this case) against income shall be provided to Salaried class as well who pay the tax even before receiving the income and have very limited options to get exemptions. 🙂

Use 80G as well as education loan interest which has no upper limit, also try to declare more during the start of the financial year so that your taxable income throughout the year is less, and during Jan, try 80G, Education loan receipts.

 

[Rishabh]

Use 80G as well as education loan interest which has no upper limit, also try to declare more during the start of the financial year so that your taxable income throughout the year is less, and during Jan, try 80G, Education loan receipts.

Not everyone have education loan and especially after 4-5 years of Job 😉

 

[Souvik]

Not everyone have education loan and especially after 4-5 years of Job 😉

🙂 I never said you have to take an education loan and then avail tax benefits, your organization needs only a piece of paper to give you an exemption, how you manage that piece of paper is your pedigree bro.

 

[Rishabh]

🙂 I never said you have to take an education loan and then avail tax benefits, your organization needs only a piece of paper to give you an exemption, how you manage that piece of paper is your pedigree bro.

There are many others such piece of papers which can be used at Organisation level to get things exempted. Am talking about the genuine measures government shall provide to Saraied class like the same enjoyed by Business class 😉

 

[Wealth is my birth right!]

There are many others such piece of papers which can be used at Organisation level to get things exempted. Am talking about the genuine measures government shall provide to Saraied class like the same enjoyed by Business class 😉

Lol business ppl are employers and salaried are employees it makes huge difference between 2 categories even IT too

 

[Souvik]

There are many others such piece of papers which can be used at Organisation level to get things exempted. Am talking about the genuine measures government shall provide to Saraied class like the same enjoyed by Business class 😉

Right, government will provide avenues to lower their tax base, tax revenues, I am perhaps too naive to foresee that. Over the years Indian government is making merry by sucking off middle class salaried tax payers for direct taxes.

The chimps in power from the cow belt of India has nowadays resorted to imposing massive tax on fuel, which in turn raises inflation for everything. If possible they will squeeze your savings to get a lower yearly fiscal deficit instead of letting you save taxes.

 

[thanix]

Please explore Hindu Undivided Family HUF concept with your CA if you are eligible.