Simplifying is one of the most useful tools when dealing with fractions. It makes the numbers easier to deal with.
Reminder when cancelling a fraction:
When you have to cancel a fraction, you need to find the highest common factor (HCF) of the two numbers and then divide by this.
Example:
Cancel the fraction.
48 
60 
For this, we need to ask what the largest number you can divide both numbers by is. In this case, it's 12.

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Cancelling when multiplying:
This one is a bit harder to get your head around. Without going into the reasons too deeply, we can cancel fractions before we multiply them by looking for common factors in the numbers.
This means we need to find a number we can divide two numbers by where one of the numbers is on one of the denominators and one is on one of the denominators.
Huh? I don't get it.
Let's look at a few examples to clarify.
Example 1:

x 

You should notice here that there is 3 on the top of the lefthand fraction and a 9 on the bottom of the right hand one.
This means we can divide both of these by 3 and we will still get the same answer when we multiply.

x 

Example 2:

x 

You should notice here that there is a 2 on the bottom of the lefthand fraction and a 4 on the top of the right hand one.
This means we can divide both of these by 2 and still get the same answer when we multiply.

x 

Are these the only ones?
There could be a combination of both the ones I have shown you.
Don't forget that you could also cancel a fraction if the numerator and the denominator have a common factor in the same fraction.