Understanding Personal Tax

Personal tax is a crucial aspect of financial planning. It encompasses various elements such as income tax, capital gains tax, and inheritance tax. Each of these components plays a significant role in how individuals manage their finances.

Income Tax

Income tax is levied on the earnings of individuals. Understanding the tax brackets and allowable deductions can significantly impact your tax liability. For instance, contributions to retirement accounts can reduce taxable income.

Capital Gains Tax

Capital gains tax applies to profits from the sale of assets. It's essential to keep track of your investments and understand how long you've held them, as this can affect the rate at which you're taxed.

Effective tax planning can lead to substantial savings.