Any scheme that has to do with minimizing, eliminating or altering the incidence of taxation may be closely scrutinized and ultimately questioned by tax authorities.

There is no question that the adoption of fraudulent means to deliberately reduce, deceive or conceal one’s correct and proper tax results in tax evasion. This is explicitly illegal and, thus, criminally punishable. In contrast, tax avoidance is exactly what the term suggests. As long as the scheme adopted does not contravene any specific tax law, it is considered within the bounds of the law, but arguably may not necessarily be within its spirit. The distinction between these two lies not in the results, as both results in the avoidance of tax, but in the legality of the transaction.