Income Tax and Corporate Tax MCQ Questions and Solutions with Explanations

Section 1 Section 2 Section 3 Section 4 Section 5 Section 6 Section 7 Section 8 Section 9

1.
Determining the tax liability is called

A. Assessment

B. Scrutiny

C. Enquiry

D. None of these

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2.
What will be the assessment year for the financial year 2004-05?

A. 2003-04

B. 2004-05

C. 2005-06

D. None of these

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3.
If the amount paid by the assessee falls short of the aggregate of tax and interest, the amount, so paid shall be adjusted towards

A. firstly by interest payable, then the balance, if any

B. firstly by balance and then the interest payable, if any

C. proportioned amount of interest and balance

D. interest first and then with balance or vice versa rest at the discretion of the assessing officer

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4.
The maximum permissible variation between ALP and transfer price, which is to be notified by the Central Government cannot exceed . . . . . . . . of the transfer price.

A. 3%

B. 2%

C. 10%

D. 5%

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5.
In which section of the income tax act, the taxpayer is defined?

A. Section 2(24)

B. Section 2(7)

C. Section 2(45)

D. Section 2(9)

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6.
The income from the asset would be taxable in the hands of the transferor if:

A. The taxpayer owns an asset

B. The ownership of asset is not transferred by him

C. The income from the asset is transferred to any person under a settlement or agreement

D. All of the above

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7.
Match the following.

List-I List-II

a. House rent allowance 1. Taxable income

b. Casual income 2. A perquisite

c. Collection charges on interest on securities 3. A deduction from income

d. Best judgement assessment capital gain 4. A step taken by 'ex authorities'

5. Is taxable income

6. Party taxable income

A. a-6, b-5, c-1, d-3

B. a-4, b-5, c-3, d-1

C. a-2, b-5, c-3, d-4

D. a-6, b-5, c-3, d-4

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8.
To reduce tax burden of the assessee by following the provisions of the income tax law is called

A. tax planning

B. tax avoidance

C. tax evasion

D. tax management

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9.
X is employed in a private company at a salary of Rs. 70,000 per month and Rs. 10,000 per month as dearness pay. He received Rs. 2,000 per month as house rent allowance. He paid Rs. 2,500 per month as house rent. What ts the exempted portion of house rent allowance?

A. Rs. 2,500

B. Rs. 2,000

C. Rs. 1,000

D. Nil

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10.
Every person whose estimated tax liability for the year is Rs. 10,000 or more is liable to pay advance tax. However, a resident senior citizen (i.e., an individual of the age of 60 years or above during the relevant financial year) not having any income from business or profession is:

A. not liable to pay advance tax

B. liable to pay tax

C. dependent upon income whether to pay tax or not

D. No set rule is there

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1 2 3 4 5 6 7 8 9 10

List-I	List-II
a. House rent allowance	1. Taxable income
b. Casual income	2. A perquisite
c. Collection charges on interest on securities	3. A deduction from income
d. Best judgement assessment capital gain	4. A step taken by 'ex authorities'
	5. Is taxable income
	6. Party taxable income

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

1. Determining the tax liability is called

Answer & Solution

2. What will be the assessment year for the financial year 2004-05?

Answer & Solution

3. If the amount paid by the assessee falls short of the aggregate of tax and interest, the amount, so paid shall be adjusted towards

Answer & Solution

4. The maximum permissible variation between ALP and transfer price, which is to be notified by the Central Government cannot exceed . . . . . . . . of the transfer price.

Answer & Solution

5. In which section of the income tax act, the taxpayer is defined?

Answer & Solution

6. The income from the asset would be taxable in the hands of the transferor if:

Answer & Solution

Answer & Solution

8. To reduce tax burden of the assessee by following the provisions of the income tax law is called

Answer & Solution

9. X is employed in a private company at a salary of Rs. 70,000 per month and Rs. 10,000 per month as dearness pay. He received Rs. 2,000 per month as house rent allowance. He paid Rs. 2,500 per month as house rent. What ts the exempted portion of house rent allowance?

Answer & Solution

10. Every person whose estimated tax liability for the year is Rs. 10,000 or more is liable to pay advance tax. However, a resident senior citizen (i.e., an individual of the age of 60 years or above during the relevant financial year) not having any income from business or profession is:

Answer & Solution

Read More Section(Income Tax and Corporate Tax)

1.
Determining the tax liability is called

2.
What will be the assessment year for the financial year 2004-05?

3.
If the amount paid by the assessee falls short of the aggregate of tax and interest, the amount, so paid shall be adjusted towards

4.
The maximum permissible variation between ALP and transfer price, which is to be notified by the Central Government cannot exceed . . . . . . . . of the transfer price.

5.
In which section of the income tax act, the taxpayer is defined?

6.
The income from the asset would be taxable in the hands of the transferor if:

8.
To reduce tax burden of the assessee by following the provisions of the income tax law is called

9.
X is employed in a private company at a salary of Rs. 70,000 per month and Rs. 10,000 per month as dearness pay. He received Rs. 2,000 per month as house rent allowance. He paid Rs. 2,500 per month as house rent. What ts the exempted portion of house rent allowance?

10.
Every person whose estimated tax liability for the year is Rs. 10,000 or more is liable to pay advance tax. However, a resident senior citizen (i.e., an individual of the age of 60 years or above during the relevant financial year) not having any income from business or profession is: