Finance and Taxation: A Complete Guidance in 2022.

Hey! Do you know Finance and taxation are crucial components for a country’s growth? Yes. Finance deals with monetary elements, and taxation is concerned with the tax enforced by the government on the assesses.

To gain knowledge on these terms. Take a deep breath, and let’s start the discussion.

What is finance?

Finance and Taxation
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Finance is the spine of any country’s wealth. Finance refers to managing the monetary aspects. It possesses actions such as investment, owing, giving loans, organizing money, saving, and making predictions.

Types of Finance: Finance and Taxation

  • Corporate Finance
  • Government or public Finance.
  • Investment Management
  • Risk Management
  • Personal Finance

Characteristics of finance:

Now you know the basic meaning and types of finance, So, what would be the Characteristics of finance. Let’s take a hurried look:

  1. Mobilization of funds of funds.
  2. Useful for investing, distributing and using the funds.
  3. Enhance Stakeholder’s Value
  4. Monetary Management

Mobilization of funds

It is known that finance acts as a crucial element of any economic system. It mobilizes the funds from savers to investors. Financial institutions help transmit the funds from one person, group of persons, and organization.

Useful for investing, distributing and using the funds:

Finance deals with investing, distributing, and using the funds. The organization should be assured that a good supply of funds is available to the firm considering reasonable cost and time factors.

 Planning should be done where to invest the funds; once the investing is done, the next step is to decide in which projects the funds should be distributed. Finally, funds should be effectively used to earn targeted profits.

Enhance Stakeholder’s Value:

The primary goal of any organization is to enhance and create goodwill for the shareholder’s value. The stakeholder’s or shareholders’ wealth is estimated by the per-share price of the firm, known as (EPS) Earning Per Share.

Monetary Management:

The firm’s financial objective is to ensure the welfare of its proprietors. It confirms that there is an adequate distribution of funds to the organization. It also ensures that suppliers receive a reasonable rate of return on their capital.

What is Taxation?

The most powerful source to generate public revenue by the Government is taxation. In the past, paying taxes was a choice for people. But, this option has been removed now, and taxation becomes mandatory to spend some part of the income as a tax to the Government.

The Government gives the general public the option to pay the tariff and take benefit of social comforts; for example, people benefit by subsidizing education, medical services, and entertainment facilities.

Types of Tax:

  1. Direct Tax: Further, it has several types-
  2. Corporate Tax
  3. Wealth Tax
  4. Estate Tax
  5. Capital Gain Tax
  • Indirect Tax: Further, it has several types-
  • Goods and Services Tax (GST)
  • Sales Tax
  • Service Tax
  • Value Added Tax (VAT)
  • Custom Duty
  • Excise Duty

Characteristics of Taxation:

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Now, you know the basic meaning of taxation, So, what would be the Characteristics of taxation. Let’s take a look at a hurried look:

  1. Tax is mandatory for all.
  2. Tax is imposed on Assesses if it is due to them.
  3. Enforced By the Government.
  4. No Direct Advantage

1. Tax is mandatory for all:

A tax is required to pay every citizen of the country to the Government. It is levied on everyone. Because Tax is mandatory to pay, no one can deny to pay it. Note that! People will not get benefits from spending it. It can be in the form of direct Tax or indirect Tax.

2. Tax is imposed on Assesses if it is due on them:

It is only to pay those who come in specific criteria such as the person who must be resident of the country, under 60 years, and if its annual income exceeds 250,000 thousand. If the person is above 60 years and his yearly income is above 3,00,000, he must pay Tax.

3. Enforced by the Government:

Only the Government can levy and collect tariffs or taxes from the assesses. A person has no freedom to collect taxes; otherwise, the Government will take restricted actions.

4. No Direct Advantage:

At present, assesses did not obtain any benefits by paying Tax. It becomes compulsory for tax collection, but individuals do not benefit from it.

Top 10 Career Options in Finance and Taxation

Finance  Taxation

  • Chartered Accountant (CA)
  • Investment banker.
  • Information technology auditor.
  • Compliance analyst.
  • Financial counsellor.
  • Insurance consultant.
  • Financial reviewer.
  • Senior accountant.
  • Hedge fund executive.
  • Chartered Secretary (CS)
  • Tax accountant.
  • Tax analyst.
  • Tax advisor.
  • Tax recruiter.
  • Tax examiner.
  • Tax administrator.
  • Tax collector.
  • Revenue Executive.
  • Business tax consultant.
  • Income Tax advisor.

Final Words:

Finance and tax both play an essential role in the country’s development. This blog discussed the basic meaning, characteristics, its various kinds, and top 10 career options in finance and taxation.

We hope that our blog will be beneficial for you and clear all your doubts. Stay connected for further updates.

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