Income Tax : An Important Part Of One 's Finances

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The famous saying “In this world nothing can be said to be certain, except death and taxes” is often attributed to Benjamin Franklin. Whether or not Franklin was the first to say this famous quote, the quote itself is quite a great way to put forward the feeling people have towards tax.

While most don’t jump out of joy when income tax filing approaches, it is nevertheless an important part of one’s finances. But how to best manage your income taxes? In this guide, you can learn about income tax, the benefits of managing your taxes and tips for ensuring you are doing the right things when it comes to income tax.

What is income tax?

Income tax is one of the most known taxes around the world. It is a tax governments impose on financial …show more content…

There are different methods countries use when it comes to deciding income tax rates. In the majority of cases income tax for individuals follows a progressive tax scale. This means that those who earn more often pay more in proportion to those earning less. Most countries use income tax for basic government funds such as healthcare, education and infrastructure.

When it comes to the history of income tax, it is interesting to note that the concept is relatively new one. Although different taxes have been part of the human history since the earliest of times, tax on income has been a relatively new invention.

For instance, in the US the first income tax was imposed during the War of 1812, as a method of repaying the debt incurred through was-related expenses. When the war ended, the tax was repelled, but income tax became a permanent fiscal tool in the early 20th century.

You can find out more about income tax from the video below:

Differences in income tax around the world

As mentioned above, the income tax systems around the world can vary somewhat, but there are certain similarities as well. Here’s a quick look at the similarities and differences around the world.

Most countries define income broadly as a tax for residents and non-residents of the jurisdiction typically don’t need to pay tax on income. There are some differences and countries have dealt with issues on

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