| Tax deduction basically refers to the amount that is | | | | legal complexity. Since it is only income that is taxed, |
| deducted from your gross income, which in turn | | | | thus majority of the companies separate revenue |
| reduces the taxable income. These deductions will | | | | from expenses in the accounts. |
| depend upon an individual’s tax return. The | | | | The increasing number of kinds of tax deductions |
| taxpayer need not pay any tax on expenses which | | | | have lead to too much of complexity. This is why |
| are tax deductible and it includes medical expenses, | | | | majority of the government these days are calling for |
| donations, brokerage fee and legal fees etc. Although | | | | simplification of tax structure. Even though tax |
| investments are tax deductible, the commission or the | | | | deductions can bring a great relief to many people, |
| brokerage fees are not so considered. Apart from | | | | these are not applicable to everyone. An individual who |
| standard deductions, you can also file additional tax | | | | is earning a huge sum of money is not eligible for any |
| deductions. | | | | tax deductions. |
| These deductions are mainly aimed at encouraging | | | | The tax deduction as well as tax structure widely |
| various initiatives like home ownership, | | | | differs from country to country. In some countries |
| entrepreneurship, environment protection, medical | | | | taxes are higher for rich people and lower for poor |
| spending etc. These deductions are sometimes utilized | | | | people, whereas in other countries the situation is just |
| for tax evasion and thus, require a small degree of | | | | vice-versa. |