An Individual Tax Payer Awareness Planning and its Impact on Wealth Creation

Avinash Totlani¹ , Asha Sharma²

Section:Research Paper, Product Type: Journal-Paper
Vol.12 , Issue.3 , pp.1-9, Sep-2024

Online published on Sep 30, 2024

Copyright © Avinash Totlani, Asha Sharma . This is an open access article distributed under the Creative Commons Attribution License, which permits unrestricted use, distribution, and reproduction in any medium, provided the original work is properly cited.
 

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Abstract :
In a country like India the rates of tax on personal income tax are very high as compared to other countries. In this situation, it is inevitable for every individual assessee to constantly update their awareness about various provisions of income tax from time to time. The objectives behind the paper is to assess the tax awareness and tax planning of the individual taxpayer and the impact of tax awareness and planning on the wealth created by an individual. The primary data was collected from 71 respondents and revealed that highest awareness was found related to deductions from 80C to 80U and the lowest awareness was found to be related to various penalties among the respondents. The standard deviation was highest for awareness related to various taxable, partly taxable and tax free allowances. For testing the difference between the mean of the groups ANOVA was applied and revealed that awareness related to advance payment of tax according to the income groups was found to be insignificant for the other provisions, the difference was found to be significant. It also revealed that awareness of the respondents was tested based on the nature of the job using ANOVA and revealed that the difference was insignificant for penalties, advance payment for tax and delayed payment of income tax, this shows that there is no difference among the respondents employed in private, semi-government and government for these provisions. For the other provisions, the difference was found to be significant. The impact of tax planning was then assessed on the wealth creation using the multiple regression method revealed that Tax Planning has positive impact on wealth creation by 78% which means that there are other factors as well that affect the creation of wealth. The highest out of the selected factors, is planning to increase savings.

Key-Words / Index Term :
Individual Tax Payers, Tax Awareness, Tax Planning, Wealth Creation & Deductions

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