Income Tax and Corporate Tax MCQ Questions and Solutions with Explanations

Income Tax and Corporate Tax MCQ Questions and Solutions with Explanations | Commerce

Income Tax and Corporate Tax MCQ Questions and answers with easy and logical explanations. Commerce provides you all type of quantitative and competitive aptitude mcq questions with easy and logical explanations. Income Tax and Corporate Tax MCQ is important for exams like B.COM, M.COM, BBA, BBM, CA, CS, CMA, CPA, CFA, UPSC, NET, Banking and other commerce department exam. Page-2 section-3

What is expected to cut out tax avoidance?

A) A change in law to make it illegal B) An amnesty for those involved in avoidance C) The government introducing more resources to fight the problem D) The introduction of professional conduct in relation to taxation code

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Answer & Solution

Answer: Option B

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Double taxation relief could be

A) bilateral relief B) unilateral relief C) multilateral relief D) Both A and B

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Answer & Solution

Answer: Option D

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If an employer transfers second hand motor car to the employee, the perquisite is valued at:

A) Actual cost less depreciation @ 30% for every completed year under straight line method B) Actual cost less depreciation @ 20% for every completed year under WDV method C) Actual cost less depreciation @ 30%for every completed year under WDV method D) Actual cost less depreciation @ 20% for every completed year under SLM method

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Answer & Solution

Answer: Option D

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In order to invoke the tax treaty for a person who is a dual resident, i.e. tax resident in both the countries, which rule may be applied under the relevant article of the tax treaties to resolve the issue?

A) Force of attraction B) Tie-breaker C) Equivalent beneficiary D) Non-discrimination

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Answer & Solution

Answer: Option B

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Authority for Advance Rulings shall not allow an application where the question raised:

A) is already pending before the Supreme Court B) involves determination of fair market value of any property C) relates to a transaction designed prima facie for the avoidance of income tax D) All of the above

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Answer & Solution

Answer: Option D

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Resident of India includes:

A) Ordinarily resident B) Not ordinarily resident C) NRI D) Both A and B

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Answer & Solution

Answer: Option D

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If the individual using the property for the business or professional purpose the income is taxable under which of the following heads?

A) Income from House property B) Income from HUF C) Income from Other D) Income from Business or Proprietorship

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Answer & Solution

Answer: Option D

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Which two of the following are correct in terms of rate of tax deduction at source (TDS)?
(1) Income by way of winning from the horse race @ 30%
(2) Insurance Commission @ 10%
(3) Rent of Plant & Machinery @ 5%
(4) Rent of furniture @ 5%
Choose the correct option from the following:

A) 1 and 2 B) 1 and 3 C) 1 and 4 D) 2 and 3

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Answer & Solution

Answer: Option C

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The payment of any simple interest to any partner is allowed only to the extent of 12% per annum as deduction as per:

A) Section 40A B) Section 40B C) Section 40C D) Section 40D

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Answer & Solution

Answer: Option B

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Value of rent-free accommodation in case of Government employee shall be taxable up to:

A) 15% of employee's salary B) 8% of employee's salary C) License fee fixed by Government D) 10% of employee's salary

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Answer & Solution

Answer: Option C

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