The biggest difference between tags and categories is that you are required to assign your post to a specific category, but you are not required to add any tags. If you do not categorize your post, it will be placed in the “uncategorized” category. People often rename this category to Other, Other, etc.
Another difference between categories and tags is what permalinks look like. If you are using a custom permalink structure, then your base prefix will look different in both cases:

What should be the optimal number of WordPress categories?

Until WordPress 2.5, there was no built-in support for tags. This led to long lists of categories because people used them to explain micro-data. Tags have been added to improve the site’s usability. By this, I mean that, according to my assumption, there is no optimal number of categories. The optimal number is based on the complexity of your site’s structure. Still, to maintain that very optimal structure and usability, it’s better if you use both subcategories and labels.
Categories are intended to encompass a group of records. The best way is to start with general categories and then add subcategories as your site grows. Through my experience in blogging, I have learned about blogging. Therefore, I will say that it will not be possible to immediately distribute all the content into the correct categories. When you start writing a blog, then, as a rule, you write one article a day, well, maybe the super talented among us give out 3-5 articles a day. It doesn’t make sense to have about 30 categories, especially if each category will have 1-2 entries. It is better to have 5 top categories with fresh content than 30 where the content is hardly updated.
Example. Let’s say we started writing our blog about social media in 2013. We want to share our lessons, news, tools, case studies, etc. We can create top categories like Twitter, Facebook, Google+, LinkedIn, etc. As subcategories, we can introduce lessons, news, tools, case studies, etc. However, in this case, we do not think about the future, which may lead to problems in the future. What if one of the social networks dies and a new one comes into play? Then you will need to enter one more top-level of categories and even more subcategories.
A much better way to organize this blog is to create timeless categories. Then your categories will look like tutorials, news, tools, case studies, etc. But how, then, do visitors know about Twitter, for example? Your categories are not supposed to do all the work. This is where the labels come into play. Let’s say you wrote an article about Twitter. Just add the Twitter tag. In your template, you can add a Popular Topics section and manually control links to popular tags like Twitter, Facebook, Google+, etc.

When should you add subcategories?

Suppose you have case study records in which you sometimes publish interviews with experts. Since you don’t have a category like “expert interviews,” you add this as a tag to your article. If you happen to start interviewing experts frequently on this topic and your “expert interviews” tag reaches 10+ entries, while continuing to grow steadily, then you should separate all of these interviews into a separate subcategory of your main “Case Studies” category.
Yes, you will have to go back and edit the old entries. If your URL structure is / category / postname / then the Redirection plugin will help you. It will automatically redirect your revised posts to their new URLs and thus preserve your site’s search rankings.

Do I have to use subcategories?

Of course not. You can always leave popular tags. In the above example, almost all posts will have their own social media tag: Twitter, Facebook, etc. But we do not categorize them. The only reason you add subcategories is to make it easier for your users to find content.
Remember, the main purpose of both categories and tags is to make searching your site easy for your users.

Is it correct to assign one entry to different categories?
You may have already come across such information on other sites that if you assign posts to several categories at once, it can damage your rating. Some even argue that because of this, you will be punished for using duplicate content. In my opinion, these statements are not entirely true. First of all, don’t get lost in SEO. Remember, the goal of effectively sorting content is to help users find it. Based on how top categories should be created, you won’t be able to categorize one post into several top-level categories. For example, your blog has three categories “Advertising, Marketing, SEO”. And your posts fall into different categories. Then maybe you need an umbrella category, under which these three will fall. Maybe, in this case, would the “Business” category be suitable? Or you will have one Advertising & Marketing category and SEO as a subcategory.
As far as the CEO is concerned, adding posts to different categories will not bring any benefit. If you think this will help your users, then use this method. Maybe some of your categories should be translated into tags? Or make them subcategories of one main category. This is primarily about improving the user experience.
If you are still very concerned about the penalties for using duplicate content, then just check the index, nofollow boxes in your SEO plugin.

When you set commands such commands “NOINDEX, nofollow” in the All-in-One SEO Pack plugin, it means that Google and bots of other search engines will not follow all links in this category and will not index them, including they will not index the main categories of the archive, which will prevent duplicate content.
Takeaway: WordPress allows you to add one post in as many categories as you want. Yes, it’s okay to assign one post to multiple categories if you think it will help your users. However, if you present your categories as Content on your blog, where each article is a separate chapter, then the answer is “No”.

Is there a limit to the number of tags that can be assigned to each post?
The short answer to this question is no. There is no limit in WordPress on the number of tags/tags you can assign to each individual post. You can add 1000+ tags if you like. Keep in mind, however, that the purpose of tags is to relate the entries in meaning. Imagine tags are index tags — popular keywords that are used to associate them with the content of a post. This makes it easier for users to find your posts, especially if they use the WordPress search engine. It also helps when using the tag archive for users. I suggest not adding more than 10 tags per post unless you need to add more. For example: if you have a blog on movie reviews, then you can add multiple tags: names of actors (only this may already exceed 10). But there is a chance that you can review several pictures with the participation of Adam Sandler. For simpler examples, I suggest limiting the number of tags you use. Otherwise, you may end up with 1000+ tags for 300 entries on the site.

Are tags the same as keywords?

People often mistakenly think that tags and keywords are the same things. This is one of the main reasons why they try to add as many tags as possible. Tags are not keywords for your blog. At least by default.

Categories or Tags: What’s Best for SEO?

The most common question on this topic is: Are there SEO preferences for the use of categories or tags? The answer is simple: No. You should not treat them as categories or systematic data (taxonomies). They have to work together. After reading this post, you should understand both the independent purpose of tags and categories and their joint purpose for the usability of your site.

Your site is for users, not for search bots. The goal of any search engine when evaluating your content is to think the way users think. If you make decisions based on the usability of your site, you will almost always reap the benefits of being an SEO. Categories and Tags are just two default taxonomies in WordPress. Most of the advanced sites use their own taxonomy to sort content along with categories and tags. Think of your blog as an evolving book. Compose your content (categories) in a smart way. Make sure it covers your blog topics broadly enough, but be careful not to make it too vague.

Use labels to logically link multiple records. If you see a certain tag becoming popular, then it might be worth releasing it into subcategories. On the other hand, if you must add this label as a subcategory of several top categories, then it is better to leave it as a label. Your goal is to make the site as user-friendly as possible.
I hope this article helps you clear up the confusion around categories and tags. I would like to hear your thoughts on this. How do you organize your content? Which method is best for you?