Tax Avoidance
/ˈtæks əˌvɔɪdəns/
Definitions
- (n.) The legal practice of arranging one's financial affairs to minimize tax liability within the bounds of the law.
The company engaged in tax avoidance by exploiting deductions and credits legally available.
- (n.) The distinction from tax evasion, where tax avoidance is lawful and tax evasion is illegal.
Tax avoidance is often scrutinized to ensure it does not cross over into tax evasion.
Related terms
See also
Commentary
Tax avoidance involves lawful strategies to reduce taxes but can be subject to anti-avoidance rules; drafters should clearly distinguish it from illegal tax evasion.
This glossary is for general informational and educational purposes only. Definitions are jurisdiction-agnostic but reflect terminology and concepts primarily drawn from English and American legal traditions. Nothing herein constitutes legal advice or creates a lawyer-client relationship. Users should consult qualified counsel for advice on specific matters or jurisdictions.