Tax laws define anything that you receive in money or kind as income and want to have a bite of it in the form of taxes. There is literally no escape from taxes. Tax legislations are framed in such a way that every individual has to pay something to the government at some point of time in the form of taxes.
Well, it seems like you have a few options left to take your entire earnings home legally without paying taxes:
1. Disability insurance premium
Disability insurance is taken to cover any loss arising from the occurrence of a disability. This could include impairment of mobility, vision or hearing as a result of accidents or age factors. The premium amount paid for disability insurance can be claimed as tax deduction. The quantum of deduction available is almost equal to life insurance in Dubai premium.
2. Proceeds from Keyman insurance bonus
Keyman insurance is life cover taken by an employer on the life of an employee. Insurance companies sometimes disburse dividends and bonuses accruing from investments made using the policy amounts. Any part of keyman life insurance bonus received by an employee is exempted from tax. However, this will require extensive calculations and supporting documentation to be submitted along with the tax returns.
3. Gift receipts
Gifts received in cash or kind upto a certain limit is always permissible as tax free. But such cash receipts or gifts should be received only on special occasions allowed by the tax law. Thankfully, most gifts are allowed as tax free. However, even if there is a situation which results in tax liability only the gift giver has to pay it and not the gift recipient.
4. Sale of residential property
Individuals and married couples who satisfy tax rules can use the sale proceeds of their residential living for leading the reminder of their lives. However, this provision is allowed mostly only for senior citizens. There is also a concept known as reverse charge mechanism which allows senior citizens to receive periodical tax free payments against sale of their residential property.
5. Dividend income
Income earned in the form of dividends from specific investments and stocks are exempted from tax. The tax component is usually borne by the dividend distributing company and is known as dividend distribution tax. Depending on the local tax laws, the entire dividend income irrespective of the type of stock can also be claimed as deduction.
The prime motive of taxes is to generate funds for the government to meet public expenditure. In addition it also acts as a barrier preventing unauthorized or illegal means of generating income. However, the above mentioned sources of income, aimed at helping selected sections of the society are perfectly legal and tax free too.