Taxation MCQs

B COM SEMESTER 5- MCQ
INCOME TAX - I
1. Income Tax Act was passed in the year……….

A) 1934 B) 1956 C) 1961 D) 1972
2. Income Tax Act came into force on…………
A)1st April 1935 B) 1st April 1961 C) 1st April 1962
D) 1st April 1956
3. Income tax is a………………….
A) Professional tax B) Direct tax C) Indirect tax
D) Service tax
4. Income tax rates are fixed in……………..
A) Income tax Act B) Finance Act C) Income tax rules
D) Finance rules
5. There are …………… heads of income
A) 3 B) 4 C) 5 D) 2
6. A person with the age of ………… or more is considered as a super senior citizen as
per Income tax Act.
A) 56 B) 60 C) 80 D) 85
7. The minimum exceptional limit of income is……………….
A) 250,000 B) 200,000 C) 300,000 D) 500,000
8. Rebate of Income tax is defined as per section ……………..
A) 81A B) 87A C) 81C D) 87C
9. Section 2(9) of Income tax deals with…………..
A) Person B) Assessee C) Previous Year
D) Assessment Year
10. Assessment year is the period of 12 months commencing from ……………. Every
year.
A) 1st March B) 31st March C) 1st April D) 30th April
11. When the income earned in an year is taxed in the same year, it is called
…………………..
A) Advanced Assessment B) Super Assessment
C) Accelerated Assessment D) None of the above
12. Surcharge is levied when the total income exceeds …………………..
A) 5 Crore B) 10 Crore C) 1 Crore D) 2 Crore
13. Educational cess is charges at the rate of ……..
A) 2% B) 1% C) 3% D) 5%
14. As per Income tax Act, Person includes ……………
A) Individual B) HUF C) Local Authority
D) All of the above
15. CBDT stands for …………………………..
A) Central Bureau of Direct Taxes
B) Central Board of Direct Taxes
C) Citizen’s Board of Direct Taxes
D) Citizen’s Bureau of Direct Taxes
16. 4. CBDT is control by …………………………………..
A) Central Government
B) State Government
C) Both (A) and (B)
D) None of this above
17. To be an Ordinarily resident in India, an individual must satisfy ……………………….
A) Both Basic Conditions and One Additional Condition
B) One Basic Condition and Both Additional Conditions
C) One Basic Condition and One Additional Condition
D) Both Basic Conditions and Both Additional Conditions
18. A Company has …………. types of residential status.
A) 2 B) 3 C) 1 D) 4
19. A citizen of India who goes abroad for the purpose of employment, he must stay in
India in the previous year for at least ............................. days to become a resident
A) 90 days B) 162 days C) 180 days D) 182 days
20. 10. Who is assessee in case of a HUF?
A) Karta B) Coparceners C) Deemed Karta D) None of these
21. Dividend from an Indian Company is …………………
A) Fully Taxable B) Partly Taxable
C) Fully Exempted D) None of these
22. Expenditure incurred on exempted income is …………. as deduction.
A) Fully Allowed B) Partly Allowed
C) Not Allowed D) None of these
23. Income exempted from tax are stated in the section……. Of Income Tax Act.
A) 5 B) 10 C) 12 D) 8
24. Income from Salary is explained in the section ……………………
A) 12 to 14 B) 15 to 17 C) 18 to 22 D) 24 to 26
25. Salary is defied as per section ……….
A) 15(2) B) 16(1) C)17(2) D)17(1)
26. When an URPF is recognized, the balance so transferred is called ………….
A) Recognized PF B) Transferred PF
C) Recognized Balance C) Transferred Balance
27. Bonus paid by the employer to the employee is …………
28. Gratuity is defined as per section ………..
A) 10(10A) B) 10(10AA) C) 10(10) D)10A
29. The highest Administrative Authority for Income Tax in India is............
A) Finance Minister. B) CBDT. C) President of India.
D) Director of Income Tax.
30. Payment made by an employer to employee monthly, other than salary is called
………….
A) Bonus B) Allowances C) Benefits D) None of these
31. HRA is ………………..
32. Rule ….. explain the taxation of HRA
A) 2 B) 2A C) 2AA D) 2AB
33. Agricultural income in Pakistan is assessable for........................
A) Resident B) Not Ordinarily Resident
C) Non-resident D) Not taxable
34. If the assessee is living in own house HRA is …………..
35. Entertainment allowance is allowed as a deduction as per section ……………
A) 16 B) 16(i) C) 16(ii) D) 16(iii)
36. Any allowance granted for encouraging research, academic and other professional
pursuit is called ………………………
A) Research Allowance B) Academic Allowance
C) Higher Educational Allowance D) Educational Allowance
37. Children education allowance is exempt up to per month per child for two children.
A) Rs.100 B) Rs.150 C) Rs.200 D) Rs.250
38. Children hostel allowance is exempt up to per month per child for two children.
A) Rs.100 B) Rs.200 C) Rs.250 D) Rs.300
39. Transport allowance given by the employer to the employee is exempt up to ………..
A) Rs.1000p.m B) Rs.1600p.m
C) Rs.1000p.a D) Rs.1600p.a
40. Foreign allowance is a …………….
A) Fully Exempted Allowance B) Fully Taxable Allowance
C) Partly Exempted Allowance D) None of these
41. State which of the following income are exempted?
A) Dearness Allowance B) City Compensatory Allowance
C) Foreign Allowance D) Medical Allowance
42. Education allowance is exempted for ……..
A) One person B) Four persons
C) Two persons D) None of these
43. A government employee received salary Rs.120,000 and entertainment allowance
Rs.10,000 during the previous year. He spent Rs.6000 on entertainment. He is entitled
to deduction u/s 16(ii) :
A) 10,000 B) 6000 C) 5000 D) Nil
44. A citizen of India who goes abroad for the purpose of employment, he must stay in
India at least for ............................. days to become a resident
A) 90 days B) 162 days C) 180 days D) 182 days
45. Who among the following may be “not ordinarily resident”?
A) Hindu Undivided Family.
B) Company.
C) Association of persons.
D) None of these
46. The following is not taxable as income under the head "Salaries".
A. Commission received by a full time director
B. Remuneration received by a partner
C. Allowances received by an employee
D. Free accommodation given to an employee
47. Previous year means the financial year immediately preceding the…………………...
A) Accounting Year B) Assessment Year
C) All of the above D) None of the above
48. Gratuity received by a government employee is .......................
A) Fully exempted
B) Partly exempted
C) Fully taxable
D) Exempted up to Rs:1,00,000
49. The periodic payment of money for the past service is known as ........................
A) Gratuity
B) Pension
C) Commuted pension
D) Leave salary
50. Income received in India whether occurred in India or outside India, the tax incidence
in case of resident is …………………………...
A) Taxable as per slabs B) Exempted from tax
C) Partly exempted D) None of the above
51. The income received and accrued outside India from a business controlled or profession
set up in India, the tax incidence in case of resident is ………………..
A) Taxable B) Non-taxable
C) Partly taxable D) None of the above
52. Pension is taxable under ..........................head.
A) Salary B) House property
C) Capital gains D) other sources
53. Salary received by a Member of Parliament is taxable under the head.........................
A) Income from salary
B) Capital gains
C) Profits and gains of business or profession
D) Income from other sources
54. A person is Non-resident if he fails to fulfil.....................
A) The additional conditions.
B) At least one of the basic conditions.
C) Both basic conditions.
D) None of these
55. Income received in India is taxable in the hands of...........................
A) Resident only.
B) Resident and ordinarily resident only.
C) Non-resident only.
D) All assessees.
56. ……………………………… is exempted from income tax.
A) Interest from Indian company B) Dividend from foreign company
C) Cooperative dividend D) Dividend from Indian company
57. The Income TaxAct,1961 broadly covers ………………………...
A) Basic charging income B) Rebates and reliefs
C) Incomes exempted from income tax D) All of the above
58. Any rent or revenue derived from land which is situated in India and is used for
agricultural purpose is ……………………...
A) Partially taxable B) Fully taxable
C) Exempted from tax D) None of the above
59. Residential Status of an assesses can be …………………………..
A) Different for different previous year in the same assessment year
B) Different for different assessment year
C) None of the above
D) All of the above
60. Which of the following is not included in salary income.
A) Commuted pension B) Un commuted pension
C) Family pension D) Leave salary
61. In case of Tax free salary, .......................................
A) Tax is to be paid by employer
B) No tax is payable on such salary
C) Tax is to be paid by the employee.
D) Govt, itself pays the tax at a future date.
62. Dearness allowance is taxable in the hands of.................
A) Govt employees B) Non Govt employees
C) All employees. D) None of these.
63. A Perk is.........................
A) Cash paid by employer to employee
B) Facility provided by employer to employee
C) Amount credited to employees.
D) None of these accounts.
64. Perquisites to employees are covered in the I.T. Act 1961 under...................
A) Sec 2a. B) Sec. 17b. C) Sec 28a. D) Sec. 36 c.
65. The value of Interest free concessional loans to employees is determined on the basis
of lending rates of ..................... for the same purpose.
A) S.B.I. B) R.B.I. C) Central govt. D) State
govt.
66. An employee is deemed as specified employee if he is a director in the company or
has substantial in the company or his chargeable salary per annum exceeds.
A) Rs. 5,00,000. B) Rs. 2,00,000.
C) Rs. 1,00,000. D) Rs. 50,000.
67. Value of rent free accommodation in case of Govt. employee shall be taxable up
to.......................
A) 15% of employees salary.
B) 7.5% of employees salary.
C) License fee fixed by Govt.
D) 10% of employees salary.
68. Value of rent free accommodation a house owned by employer in case of non- Govt.
employees with above 25 lakhs population is...........................
A) 10% of employees salary
B) 15% of employees salary
C) 7.5% of employee salary
D) 20% of employees salary
69. Interest on RPF balance is exempted up to.......................
A) 9.75%. B) 9.5%. C) 10%. D) 12%.
70. Employers contribution to RPF is exempted up to...................
A) 10% of salary. B) 13% of salary.
C) 12% of salary. D) 11% of salary.
71. The income of previous year is chargeable to tax in the ……………………...
A) Immediately succeeding assessment year
B) Same previous year
C) Immediately preceding academic year
D) None of the above
72. The interest on loan paid by the Government of India to a non-resident outside India
is ……………….. in India.
A) Not taxable B) Partially taxable
C) Taxable D) Can’t say
73. The salary, remuneration or compensation received by the partners is taxable under
the head ………………………….
A) Income from Other Sources B) Income from Business
C) Salary D) None of the above
74. The death-cum-retirement gratuity received by the Government Employee or
employee of local authority is ………………………….
A) Partially exempted B) Fully exempted
C) Half taxable D) None of the above
75. Under Section 15 of Income Tax Act, the salary due in previous years and even if it is
not received is ………………………...
A) Taxable B) Not taxable
C) Partially taxable D) None of the above
76. The assesses can claim relief under ………………………… for arrears or advance
salary.
A) Section 89(1) B) Section89(2)
C) Section 89(3) D) Section89(4)
77. The Payment of Gratuity Act came into force in ……………………..
A) 1973 B) 1980 C) 1991 D) 1972
78. Deduction from gross Total income is allowed under Sec. 80C up to lower of the
Qualifying amount or a maximum of.
A) Rs. 50,000. B) Rs. 80,000.
C) Rs. 1,00,000. D) Rs. 2,00,000.
79. Profits earned from an illegal business are..........................
A) Taxable.
B) Tax free.
C) Ignored by Tax Authorities.
D) treated as other income.
80. Medical reimbursement is exempt upto .................. if treatment is done in a private
hospital.
A) Rs: 5,000 B) Rs: 10,000
C) Rs: 15,000 D) Rs: 50,000
81. Which of the following is exempted.
A) C.C.A B) D.A
C) Foreign Allowance D) Medical Allowance
82. Free food provided to employees is exempted upto ...................... per meal.
A) Rs: 40 B) Rs: 50
C) Rs: 60 D) Rs: 15
83. Which of the following is not taxable under the head Salary?
A) Remuneration paid to the lecturer of a college for setting a question paper
B) Salary received by a member of parliament
C) Commission received by an employee director of a company
D) Both (a) and (b)
84. In accordance with the provisions of Section 17(1) of Income Tax Act, 1961, the term
salary includes ……………………..
A) Any annuity or pension
B) Any gratuity
C) Any fees, commission, perquisite or profits in lieu of or in addition to any salary or
wages D) All of the above
85. If the employee receives retirement gratuity from more than one employer, he can
claim exemption in respect of ………………………...
A) Current employer B) Previous employer
C) Both employer D) Not from single employer
86. The family pension received by the family members of armed forces after death of
employee is ……………………………….
A) Exempt fully B) Exempted after fulfilling of certain
conditions
C) Not exempted D) None of the above
87. The entertainment allowance is applicable to ……………………..
A) Private sector employees B) Public sector employees
C) Government employees D) All of the above
88. The entertainment tax allowed as a deduction under Section 16 of Income Tax Act is
the least of ………………………….
A) Actual amount of entertainment allowance received
B) 20% of basic salary of the individual
C) 50,00
D) All of the above
89. Income accrued outside India and received outside India is taxable in case of
………………………….
A) Resident and ordinary resident (ROR)only
B) Resident but not ordinary resident (RNOR)only
C) Non-resident only
D) ROR, RNOR and Non-resident
90. Gross Total Income is arrived after ………………………..
A) only adding Income under five heads of Income
B) adding Income under five heads of Income excluding losses
C) adding Income under five heads of Income, after applying clubbing provisions and
making adjustment of set off and carry forward of losses
D) adding Income under five heads of Income, after applying clubbing provisions and
making adjustment of set off and carry forward of losses and after allowing deduction
undersection 80Cto80U
91. Employer provides a car (below 1.6 ltr capacity) along with a driver to X partly for
official and partly for personal purpose. The expenses incurred by the company are:
running and maintenance expenses – ` 32,000 and driver’s salary – ` 36,000 . Taxable
value of perquisite is ……………………….
A) 21,600 B)10,800 C)32,400 D)39,600
92. Encashment of earned leave is given by ……………………… of Income TaxAct,
1961.
A) Section 10(10AA) B) Section12(10A)
C) Section 15(10B) D) None of the above
93. Compensation received on voluntary retirement is given by ……………………. of
Income Tax Act,1961.
A) Section 10(10D) B) Section10(10C)
C) Section 10(10E) D) Section11(10D)
94. 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 costless depreciation @20% for every completed year under WDV
method
C) Actual costless depreciation @30% for every completed year under WDV method
D) Actual costless depreciation @20% for every completed year under SLM method
95. The following is not taxable as income under the head “Salaries”:
A) Commission received by a full-time director
B) Remuneration received by a partner
C) Allowances received by an employee
D) Free accommodation given to an employee
96. The following is exempt income from Income Tax:.
A) Travel concession to employee
B) Remuneration received for valuation of answer scripts
C) Encashment of leave salary whilst in service
D) Perquisites in India
97. Gift to employee up to ……………………… p.a. will not be treated as perquisite
taxable in the hands of employee.
A) 4,000 B) 5,000 C) 10,000 D) 2,500
98. Salary received by the manager of an agricultural farm is .................................
A) An agricultural income. B) A salary income.
C) A business income. D) A capital income.
99. Any benefits attached to an office or position in addition to salary or wages is called
……………..
A) Allowances B) Perquisites
C) Benefits D) None of these
100. Leave travel concession is explained as per section ……………
A) 10(1) B) 10(5) C) 10(10) D)
10(5A)
101. Under the head Income from House Property the basis of charge is
………………………
A) Rent Received B) Gross Annual Value
C) Annual Value D) Municipal Value
102. Foreign house property’s income is taxable only in the case of ……………………..
A) Non Resident B) Not Ordinarily Resident
C) Ordinarily Resident D) None of the above
103. Annual value is defined as per section …………..
A) 21(1) B) 22(1) C) 23(1)
D) 24(1)
104. Which of the following is deductible from the annual value of HP?
A) Municipal Taxes paid
B) Municipal taxes paid by the owner
C) Municipal taxes paid by the owner for the previous year
D) Municipal taxes paid by the owner during the previous year
105. The Income from House Property is taxable in the hands of the individual even if
property is not registered in his name …………………………….
A) When the property has been transferred to spouse for inadequate consideration
B) Where the property is transferred to a minor child for inadequate consideration
C) Where the individual holds on importable estate
D) All of the above
106. The following conditions must be satisfied to charge the rental income under the head
Income of House Property:
A) The property should consist of any buildings or lands
B) The asssessee should be one of the property
C) The property should not be used by the owner for the purpose of business or
professional purpose
D) All of the above
107. Mr. Ram owns a house property. He lent it to Laxman at ` 10,000 p.m. Laxman sublet
it to Mr. Maruti on monthly rent of ` 20,000 p.m. Rental income of Ram is taxable
under the head ………………………………...
A) Income from Salary B) Income from Other Sources
C) Income from House Property D) Income from Business
108. Mr. Ram owns a house property. He lent it to Laxman at ` 10,000 p.m. Laxman sublet
it to Mr. Maruti on monthly rent of ` 20,000 p.m. Rental income of Laxman is taxable
under the head …………………………………….
A) Income from Salary B) Income from Other Sources
C) Income from House Property D) Income from Business
109. For claiming the deduction for unrealised rent, the assessee must satisfy ……………..
A) Rule 4 B) Section 4
C) Rule 4A D) Section 4 A
110. Rule 4 includes ………………………….
A) Tenancy must be bonafide
B) The defaulting tenant has vacated or steps have been taken to vacate the house
C) The defaulting tenant is not occupying any other property of the owner
D) All of the above
111. The tax paid by the tenant is ……………………
A) Added to rent received
B) No adjustment
C) Deducted from rent received
D) Added to Annual value
112. If the house remains vacant for the whole year, annual value will be …………..
A) Equal to Municipal Value
B) Equal to Fair rent
C) Nil
113. A sum equal to …………… is allowed as deduction from the annual value.
A) 15% B) 20% C) 25% D) 30%
114. A sum equal to 30% is allowed as deduction from the annual value as ………………
A) Deduction B) Standard Deduction
C) Basic Deduction D) None of the above
115. Interest on loan taken for which all purposes are deductible from annual value?
A) Purchase B) Repair
C) Construction D) All of the above
116. Deductions from annual value is as per section …………
A) 22 B)24 C)26 D)24A
117. Which of the following is not deductible from annual value?
A) Interest on unpaid interest
B) Interest on loan taken for repairs
C) Interest on loan taken for reconstruction
118. Interest for pre-acquisition period is deductible in ………………. instalments
A) 3 B)4 C)5 D)7
119. Annual value of self-occupied house is ……………………..
A) Equal to Municipal Value
B) Equal to Fair rent
C) Nil
120. From the amount of arrears of rent received, …………. Is allowed as deduction.
A) 15% B) 20% C) 25% D) 30%
121. The balance of unabsorbed loss from HP can be carry forward to a maximum of ……..
years.
A) 6 B)7 C)5 D) None of these
122. Rent from vacant plot of land is assessible under the head …………………
A) Income from HP B) Income from Other Source
C) Income from Capital Gain D) None of the above
123. Subletting is assessible under the head …………………
A) Income from HP B) Income from Other Source
124. In case of disputed ownership, income from HP is chargeable in the hands of …………
A) Recipient of income B) Not assessible
C) All owners D) None of the above
125. What is expected rent?
A) Municipal value of Fair value whichever is lower
B) Municipal value of Fair value whichever is higher
C) Municipal value of Fair value whichever is higher subject to standard rent
D) None of these
126. An individual who transfers house property without an adequate consideration to his
owner spouse or to minor child is called as ………………….
A) Co-owner B) Deemed Owner
C) Owner Himself D) None of the above
127. An individual is considered as an owner of the house property for the purpose of
charging tax to …………………..
A) A member of cooperative society, company or AOP to whom a building or a part
there of is allotted or leased under a house building scheme of the society.
B) An individual who transfers house property without an adequate consideration to his
owner spouse or to minor child
C) The holder of importable estate
D) All of the above
128. If the assesses let out the building or staff quarters to the employee of business, the rent
collected from such employees is assessable as income from ……………...
A) Business B) House Property
C) Other Sources D) None of the above
129. The Gross annual value of the property is depends upon the ……………….
A) Standard rent B) Municipal Valuation
C) Fair rent D) All of the above
130. Which of the following is not a case of deemed ownership of house property?
A) Transfer to a spouse for inadequate consideration
B) Transfer to a minor child for inadequate consideration
C) Holder of an importable estate
D) Co-owner of a property
131. If an assesses earns rent from a sub-tenant in respect to tenanted property let out as a
residence, the said rent is …………………..
A) Exempted under Section 10
B) Taxable under the head income from house property
C) Taxable as business income, as the letting out is a commercial activity
D) Taxable as income from other sources
132. An assesses, after sale of house property, receiving arrears of rent (is/is not) chargeable
to tax; the same computed in the stipulated manner, is chargeable to tax as
……………...
A) Income from House Property B) Income from Other Sources
C) Either (a)or(b) D) Neither (a)nor (b)
133. Mr. Shushant is the owner of a house, the details of which are given below the gross
annual value would be ……………... Municipal value ` 36,000 Actual rent ` 32,000
Fair Rent` 36,000 Standard Rent` 40,000
A) 36,000 B) 35,000 C) 30,000 D) 40,000
134. Interest on capital, borrowed on 10.10.2000, for self-occupied property is deductible up
to a maximum amount of ………………...
A) 50,000 B) 1,50,000 C) 5,000 D) None of the above
135. Interest on loan for self-occupied house taken before 1st April, 1999 will be allowed up
to ……………………...
A) 30,000 B) 1,50,000 C) 10,000 D) 50,000
136. Deduction allowed from annual value is …………………...
A) Interest on loan for constitution B) Interest on loan for repair
C) Statutory deduction D) All of the above
137. When the portion of the house is self-occupied for the full year and portion is self-
occupied for the whole year, the annual value of the house shall be determined by
…………..
A) The full annual value of the house the proportionate annual value of self-occupied
portion for the whole year shall be deducted
B) Its present standard value
C) All of the above
138. Mr. R owns a house. The Municipal value of the house is ` 50,000. He paid ` 8,000 as
local taxes during the year. He uses this house for his residential purposes but lets out
half of the house @ ` 3,000 p.m. The annual value of the house is ………...
A) 15,000 B) 16,000 C) 17,000 D) 18,000
139. If fair rent is not gives, then assume ………… as fair rent.
A) Actual rent B) Standard rent
C) Average rent D) None of the above
140. Rent received by original tenant from sub-tenant is taxable under the head ………...
A) Income from House Property B) Income from Other Sources
141. Income from property held under trust for charitable or religious purposes is ………….
A) Exempted from tax B) Taxable @10%
C) Taxable @20% D) None of the above
142. Identify the correct head
A) Income from business and profession
B) Profits from business and profession
C) Profit and Gains from business and profession
D) None of these
143. Business can be defined as per section ……….
A) 2(11) B) 2(12) C) 2(13) D) 2(14)
144. Income from illegal business is …………
A) Partly taxable B) Taxable
C) Exempted D) None of these
145. Expenditure on scientific research is in the section ……..
A) 31 B) 32 C)35 D)36
146. Any payments made outside India and TDS is not paid, then it is …………
A) Allowed B) Disallowed
C) Partly allowed D) None of these
147. Payment made in cash exceeding ………….. is disallowed.
A) 15000 B) 20000 C) 25000 D) 30000
148. Interest on delayed payment of VAT is …………..
A) Allowed B) Disallowed
C) Partly allowed D) None of these
149. Under the Income Tax Act,1961, depreciation on machinery is charged on
………………..
A) Purchase price of the machinery B) Written down value of the machinery
C) Market price of the machinery D) All of the above
150. As per section 30, which expenditure incurred for a building used for the business or
profession shall not be allowed as deduction?
A) Rent, rates and taxes B) Insurance of building
C) Repairs of building D) Capital expenditure
151. Group of assets falling within a class of assets comprising of tangible & intangible
assets is known as :
A) Group of assets B) Block of assets
C) Set of assets D) None of these
152. If a block of assets ceases to exist on the last day of the previous year, depreciation
admissible for block of assets will be ………………….
A) Nil
B) 50% of the value of the block of assets on the first day of 'he previous year
C) The total value of the block of assets on the first day of the previous year
D) 50% of the value of the block of assets on the last day of the previous year.
153. Payments to residents on which tax has not been deducted/ paid shall be disallowed to
the extent of …………………………
A) 0% B) 30% C) 100% D) 50%
154. Which of the following taxes are allowed as deduction while computing the business
income ………………………………
A) Wealth-tax B) Income-tax
C) Sales tax D) None of the above
155. DS made a cash payment of Rs. ` 2,95,000 on 28th March, 2019 as the banks were on
strike that day and the payment was to be made urgently. Calculate the amount of
expenditure to be disallowed u/s 40A.
A) Rs. 2,95,000 B) Rs.2,75,000 C) Nil D) Rs.
10,000
156. Where an assessee doing a business incurs any expenditure in respect of which
payments made to a person in a day exceeds Rs. ` 10,000 should be paid through
account payee cheque or demand draft to claim deduction for such expenditure. This
restriction does not apply to ………………
A) Payments made to RBI
B) Payments made to cultivators
C) Payment of terminal benefits to employees not exceeding ` 50,000
D) All of the above
157. Deemed profits chargeable to tax under section 41 includes:
A) Taxability of Balancing Charge in case of Power Generating Undertakings.
B) Sale of an asset used for scientific research without having been used for the
purposes of business or profession.
C) Recovery of bad debts.
D) All of the above.
158. DS discontinued wholesale trade in medicines from 1st June, 2015. He recovered Rs. `
1,40,000 in September, 2018 being a bad debt which was written-off and allowed in
assessment year 2015-14. He has eligible brought forward business loss of wholesale
trade in medicines of Rs. ` 1,60,000. The consequence of bad debt recovery is that –
A) It is chargeable to tax
B) It is eligible for set-off against brought forward business loss
C) The brought forward business loss is taxable now
D) 50% of the amount recovered now is taxable
159. As per section 43B, certain payments are to be allowed as deduction only on actual
payment. Such sums include:
A) Any sum payable by the assessee to the Indian Railways for the use of railway assets.
B) Employer's contribution to provident fund or superannuation fund or gratuity fund
or any other fund for the welfare of employees.
C) Bonus or commission to employees for services rendered as referred uls 36(1)(ii).
160. The profits and gains of any business of insurance, including any such business carried
on by a mutual insurance company or by co-operative society, shall be computed in
accordance with rules contained in First Schedule to the Act. The profits and gains
derived from life insurance business is taxable at what rate?
A) 11.5% B) 12.5% C) 10% D) Nil
161. Which is the charging section of income under the head profits and gains of business
or profession?
A) Section 15 B) Section 24
C) Section 28 D) Section 17
162. Raman & Co., a partnership firm, received Rs. ` 5, 00,000 from an insurance company
under key man insurance policy consequent to demise of partner Pramod. The amount
of premium Rs.` 2, 30,000 paid earlier was claimed as deduction under section 37 by
the firm. The amount received from the insurance company is –
A) Tax-free under section 10(10D) B) Fully taxable as income
C) Rs.` 2,70,000 is taxable D) Rs.` 2,30,000 is taxable
163. Assessee is having stock existing in the business. Valuation of stock will be at:
A) Cost price B) Market price
C) Cost or market price, whichever is less D) Cost or market price, whichever is

more
164. Export Incentives taxable under this head includes:

A) Cash Compensatory Support B) Duty Drawback
C) Profit on transfer of DEPB D)All of the above
165. ……………………. includes any arrangement or understanding or action in concert
whether or not it is formal or in writing or whether or not it is intended to be enforceable
by legal proceedings:
A) Contract B) Agreement
C) Service D) Profession
166. Which of the following conditions are to be fulfilled for charging an income under the
head profits and gains of business or profession
A) There should be profits and gains.
B) Business or profession must be carried on by the assessee.
C) Business or profession should be carried on at any time during previous year.
167. Which of the following are included in business according to section 2(13) :
A) Trade B) Commerce
C) Manufacture D) All of the above
168. X, Manager of XYZ Ltd. since 2004 was terminated by the company on 1st August,
2018 by paying a compensation of Rs. 200 lakh. Such compensation is
…………………………
A) Chargeable under the Wealth-tax Act, 1957
B) Not chargeable under the Income-tax
C) Chargeable under section 17(3)(i)
D) Chargeable under section 28(ii) (a).
169. DSK, an LLP had taken key man insurance policy on the life of its managing partner.
The policy got matured on 13th September, 2018 and an amount of Rs.`75lakh was paid
by the insurers to the managing partner. The amount so received on maturity of the
policy by the managing partner is ………………..
A) Fully exempt u/s 10(10D) B)50% of Rs. 75lakh exempt
C) Rs.` 75lakh taxable D)Rs.` 25 lakh exempt and Rs.` 50 lakh
taxable
170. Circulars and Notifications are binding on the
A) Central Board of Direct Taxes (CBDT) B) Assessee
C) Income Tax Appellate Tribunal (ITAT) D) Income Tax Authorities
171. Who amongst the following confers on the power to issue circulars and clarifications?
A) ITAT B) Central Government
C) CBDT D) State Government
172. Amendments by the finance act are made applicable from
A) First day of next financial year B) First day of same financial year
C) Last day of same Accounting year D) None of the above
173. As per section 2(31), the following is not included in the definition of 'person'
A) An individual B) A Hindu undivided family
C) A company D) A minor
174. Which amongst the following is an exception to the previous year rule?
A) Business or Profession newly set up. B) Where a source of income
newly set up.
C) Non-resident engaged in shipping business D) None of the above
175. Which amongst the following is not a head of Income?
A) Salaries B) Income from house Property
C) Capital gains D) Income from exports
176. Which of the following is not included in taxable income –
A) Reimbursement of expenses B) Cash gifts received from non relatives
C) Income from illegal activity D) Profit on sale of equity shares of
unlisted company
177. In case of non-residents engaged in shipping business in India income earned during
the financial year is
A) Taxable in India the same financial year
B) Taxable in India the relevant assessment year
C) Not taxable in India in the same financial year
D) Not taxable in India
178. Additional surcharge (education cess) of 3% per cent is payable on
A) Income tax B) Income tax plus surcharge
C) Surcharge D) None of these
179. The salary, remuneration or compensation received by the partners is taxable under the
head ………………………...
A) Income from Other Sources B) Income from Business
C) Salary D) None of the above
180. The death-cum-retirement gratuity received by the Government Employee or employee
of local authority is ………………………...
A) Partially exempted B) Fully exempted
C) Half taxable D) None of the above
181. Rent Free Accommodation given to an employee by the employer is a ………………..
A) Allowance B) Perquisite
C) Profit in lieu of salary D) None of the above
182. Payment of Gratuity Act came into force in ………………...
A) 1973 B) 1980 C) 1991 D) 1972
183. The entertainment allowance is applicable to…………………….
A) Private sector employees B) Public sector employees
C) Government employees D) All of the above
184. ……………………. is the rent fixed under Rent control Act.
A) Municipal rental value B) Fair rental value
C) Standard rent D) Real rent
185. For computation of Gross Annual Value, if actual rent is more than expected rent, then
we select the …………………………..
A) Actual rent B) Expected rent
C) Any of the above D) None of the above
186. Under the Income Tax Act, 1961, depreciation on machinery is charged on
………………….
A) Purchase price of the machinery B) Written down value of the machinery
C) Market price of the machinery D) All of the above
187. ………………………are not treated as agricultural income.
A) Income from poultry farming B) Income from bee heaving
C) Purchase of standing crop D) All of the above
188. Suman, has rendered services in India and retired in 2011. He then shifted and settled
in Singapore. The pension received by him for such services would be
……………………. ?
A) Deemed to accrue or arise outside India
B) Deemed to accrue or arise in India
C) Deemed to accrue or arise in India only when it is received in India
D) Deemed to accrue or arise in India only when it is received outside India
189. Educational cess is leviable in case of ………..
A) Individual B) HUF
C) Company D) All assesses
190. A car is imported after 1- 4- 2005 by R Ltd. from London to be used by its employee.
R Ltd. shall be allowed depreciation on such car at:
A) 15% B) 40% C) 60% D)
Nil
191. Certain revenue and capital expenditure on scientific research are allowed as deduction
in the previous year of commencement of business even if these are incurred:
A) Five years immediately before the commencement of business
B) 3 years immediately before the commencement of the business
C) Any time prior to the commencement of the business.
D) None of these
192. Preliminary expenses incurred are allowed deduction in:
A) 10 equal annual instalments B) 5 equal annual instalments
C) full D) None of these
193. In case the assessee follows mercantile system of accounting, bonus or commission to
the employee are allowed as deduction on:
A) Due basis B) Payment basis
C) Due basis but subject to section 43B D) Any of the above
194. For person carrying on profession, tax audit is compulsory, if the gross receipts of the
previous year exceeds
A) Rs.50 lakhs B) Rs.40 lakhs
C) Rs.10 lakhs D) Rs.5 lakhs
195. Tax audit is compulsory in case a person is carrying on business whose gross
turnover/sales/receipts, as the case may be, exceeds:
A) Rs. 10 lakhs B) Rs. 40 lakhs
C) 1 crore D) 10 crore
196. In case an assessee is engaged in the business of civil construction, presumptive income
scheme is applicable if the gross receipts paid or payable to him in the previous year
does not exceed:
A) Rs.10 lakhs B) Rs. 40 lakhs
C) Rs. 50 lakhs D) 1 crore
197. In case an assessee is engaged in the business of retail trade, presumptive income
scheme is applicable if the total turnover of such retail trade of goods does not exceed:
A) Rs.10 lakhs B) Rs.30 lakhs
C) Rs.40 lakhs D) Rs.50 lakhs
198. A is entitled to children education allowance @ Rs. 80 p.m. per child for 3 children
amounting Rs. 240 p.m. It will be exempt to the extent of :
A) Rs.200 p.m. B) Rs.160 p.m.
C) Rs. 240 p.m. C) Rs. 120 p.m.
199. R gifted his house property to his wife in 2000. R has let out the house property @
Rs.5,000 p.m. The income from such house property will be taxable in the hands of :
A) Mrs. R
B) R. However , income will be computed first as Mrs. R’s income and thereafter
clubbed in the income of R
C) R as he will be treated as deemed owner & liable to tax
200. Income tax is a …………………..
A) Direct tax B) Indirect tax
C) Any of the above D) None of the above
ANSWER KEY
1. C) 1961 32. B) 2A
2. C) 1st April 1962 33. A) Resident
3. B) Direct tax 34. A) Fully Taxable
4. B) Finance Act 35. C) 16(ii)
5. C) 5 36. B) Academic Allowance
6. C) 80 37. A) Rs.100
7. C) 300,000 38. D) Rs.300
8. B) 87A 39. B) Rs.1600p.m
9. D) Assessment Year 40. A) Fully Exempted Allowance
10. C) 1st April 41. C) Foreign Allowance
11. C) Accelerated Assessment 42. C) Two persons
12. C) 1 Crore 43. C) 5000
13. C) 3% 44. D) 182 days
14. D) All of the above 45. A) Hindu Undivided Family.
15. B) Central Board of Direct Taxes 46. B. Remuneration received by a
16. A) Central Government partner
17. B) One Basic Condition and Both 47. B) Assessment Year
Additional Conditions 48. A) Fully exempted
18. A) 2 49. B) Pension
19. D) 182 days 50. A) Taxable as per slabs
20. A) Karta 51. A) Taxable
21. C) Fully Exempted 52. A) Salary
22. C) Not Allowed 53. D) Income from other sources
23. B) 10 54. B) At least one of the basic
24. B) 15 to 17 conditions.
25. D)17(1) 55. D) All assesses
26. C) Transferred Balance 56. D) Dividend from Indian company
27. A) Fully Taxable 57. D) All of the above
28. C) 10(10) 58. C) Exempted from tax
29. B) CBDT 59. B) Different for different
30. B) Allowances assessment year
31. B) Partly Taxable 60. C) Family pension
61. A) Tax is to be paid by employer 90. D) adding Income under five heads
62. C) All employees of Income, after applying clubbing
63. B) Facility provided by employer provisions and making adjustment
to employee of set off and carry forward of
64. B) Sec. 17b. losses and after allowing deduction
65. A) S.B.I. undersection 80Cto80U
66. D) Rs. 50,000. 91. C)32,400
67. C) License fee fixed by Govt. 92. A) Section 10(10AA)
68. B) 15% of employees salary 93. B) Section10(10C)
69. B) 9.5% 94. D) Actual costless depreciation
70. C) 12% of salary @20% for every completed year
71. A) Immediately succeeding under SLM method
assessment year 95. B) Remuneration received by a
72. A) Not taxable partner
73. B) Income from Business 96. D) Perquisites in India
74. B) Fully exempted 97. B) 5,000
75. A) Taxable 98. B) A salary income.
76. A) Section 89(1) 99. B) Perquisites
77. D) 1972 100. B) 10(5)
78. C) Rs. 1,00,000. 101. C) Annual Value
79. A) Taxable. 102. C) Ordinarily Resident
80. C) Rs: 15,000 103. C) 23(1)
81. C) Foreign Allowance 104. D) Municipal taxes paid by the
82. B) Rs: 50 owner during the previous year
83. D) Both (a) and (b) 105. D) All of the above
84. D) All of the above 106. D) All of the above
85. C) Both employer 107. C) Income from House Property
86. B) Exempted after fulfilling of 108. B) Income from Other Sources
certain conditions 109. A) Rule 4
87. C) Government employees 110. D) All of the above
88. D) All of the above 111. B) No adjustment
89. A) Resident and ordinary resident 112. C) Nil
(ROR)only 113. D) 30%
114. B) Standard Deduction
115. D) All of the above 142. C) Profit and Gains from business
116. B)24 and profession
117. A) Interest on unpaid interest 143. C) 2(13)
118. C)5 144. B) Taxable
119. C) Nil 145. C)35
120. D) 30% 146. B) Disallowed
121. B)7 147. B) 20000
122. B) Income from Other Source 148. A) Allowed
123. B) Income from Other Source 149. C) Market price of the machinery
124. A) Recipient of income 150. D) Capital expenditure
125. C) Municipal value of Fair value 151. B) Block of assets
whichever is higher subject to 152. A) Nil
standard rent 153. B) 30%
126. B) Deemed Owner 154. C) Sales tax
127. D) All of the above 155. C) Nil
128. C) Other Sources 156. D) All of the above
129. D) All of the above 157. D) All of the above
130. D) Co-owner of a property 158. B) It is eligible for set-off against
131. D) Taxable as income from other brought forward business loss
sources 159. D) All of the above.
132. C) Either (a)or(b) 160. B) 12.5%
133. A) 36,000 161. C) Section 28
134. B) 1,50,000 162. B) Fully taxable as income
135. A) 30,000 163. C) Cost or market price, whichever
136. D) All of the above is less
137. A) The full annual value of the 164. D)All of the above
house the proportionate annual 165. B) Agreement
value of self-occupied portion for 166. D)All of the above
the whole year shall be deducted 167. D)All of the above
138. B) 16,000 168. D) Chargeable under section 28(ii)
139. A) Actual rent (a).
140. B) Income from Other Sources 169. C) Rs.` 75lakh taxable
141. A) Exempted from tax 170. D) Income Tax Authorities
171. C) CBDT
172. A) First day of next financial year 187. D) All of the above
173. D) A minor 188. B) Deemed to accrue or arise in
174. C) Non-resident engaged in India
shipping business 189. D) All assesses
175. D) Income from exports 190. D) Nil
176. A) Reimbursement of expenses 191. B) 3 years immediately before the
177. C) Not taxable in India in the same commencement of the business
financial year 192. B) 5 equal annual instalments
178. B) Income tax plus surcharge 193. C) Due basis but subject to section
179. B) Income from Business 43B
180. B) Fully exempted 194. C) Rs.10 lakhs
181. B) Perquisite 195. B) Rs. 40 lakhs
182. D) 1972 196. B) Rs. 40 lakhs
183. C) Government employees 197. C) Rs.40 lakhs
184. C) Standard rent 198. A) Rs.200 p.m.
185. A) Actual rent 199. C) R as he will be treated as deemed
186. B) Written down value of the owner & liable to tax
machinery 200. A) Direct tax
GST
 1 . IGST is payable when the supply is ........

 a) Interstate c) Intra-state
 b) Intra- UT d) All of the above
GST
 1 Maximum rate of CGST prescribed by law for

intrastate supply made is.......
 a) 18% c) 20%
 b) 40% d) 28%+cess
GST
 3 . Which of the following taxes have been subsumed
in GST?
 a) Central sales tax b) Central excise duty
 c) VAT d) All of the above
GST
 GST is levied on supply of all goods and service
except.....
 a) Alcoholic liquor for human consumption
b) Tobacco
c) Health care service
d) All of the above
GST
 Aggregate turnover does not include-
 (a) Inward supplies on which tax is payable on reverse
charge basis
 (b) Exempt supplies
 (c) Export of goods or services or both
 (d) Inter-State supplies of persons having the same
PAN number
GST
 . What are the taxes levied on an intra-State supply?
 (a) CGST (b) SGST
 (c) CGST and SGST (d) IGST
GST
 . Who will notify the rate of tax to be levied under
CGST Act?
 (a) Central Government
 (b) State Government
 (c) GST Council
 (d) Central Government as per the recommendations
of the GST Council
GST
 . 13 . Which of the following taxes will be levied on
imports?
 (a) CGST (b) SGST
 (c) IGST (d) CGST and SGST
GST
 Aggregate turnover includes:
 a) Taxable supplies of goods or service or both
 b) Exempt supplies of goods
 c) Exports
 d) All of the above
GST
 Within how many days a person should apply for
registration?
 a. Within 60 days from the date he becomes liable for
registration.
 b. Within 30 days from the date he becomes liable for
registration.
 c. No Time Limit
 d. Within 90 days from the date he becomes liable for
registration.
GST
 What is the validity of the registration certificate?
 a. One year
 b. No validity
 c. Valid till it is cancelled.
 d. Five years.
GST
 If an entity has multiple branches within the same
state, it requires
 a) Registration for each branch separately
 b) Single registration for all the branches
 c) Multiple registration or single registration at the
option of the Assessee
 d) Registration for each branch separately if the
turnover of each branch exceeds INR 20 Lakhs
GST
 Deposits towards tax, penalty, interest, fee or any
other amount are credited into the
_________________of a taxable person.
 a) Electronic liability register
 b) Electronic credit ledger
 c) Electronic cash ledger
 d) All of the above
GST
 Which of the following liability cannot be adjusted
against input tax credit of CGST?
 a) IGST
 b) SGST/UTGST
 c) All of the above
 d) None of the above
GST
 What does N stand for in HSN?
 a) Network
 b) Nationalization
 c) Nomenclature
 d) Nomination
GST
 Which form is furnished for submission of details of
outward supplies u/s 37?
 a) GSTR-1
 b) GSTR-2
 c) GSTR-3
 d) GSTR-5
GST
 The due date for filing GSTR-3B is _______.
 a) on 10th day of the next month
 b) on 15th day of the next month
 c) on 17th day of the next month
 d) on or before 20th day of the next month
IT
 2. A person with the age of ………… or more is
considered as a super senior citizen as per Income tax
Act
 A) 80
B) 70
C) 50
D) 60
IT
 Rebate of Income tax is defined as per section …
 A) 81A
B) 81C
C) 87A
D) 87C
IT
 Bonus paid by the employer to the employee is
 A) Fully Taxable
B) Partly Taxable
C) Fully Exempted
D) None of these
IT
 HRA is …
 A) Fully Taxable
B) Fully Exempted
C) Partly Taxable
D) None of these
IT
 . Income tax is a
 A) Direct tax
B) Indirect tax
C) Total tax
D) Danger tax
IT
 Assessment year start on
 A) 1st April
B) 31st march
C) 1st July
D) None of the Above
IT
 Residential status is determined on
 A) Assessment year
B) Calendar year
C) Previous year
D) Accounting year
IT
 RPF full form in income tax
 A) Reserve police force
B) Railway police force
C) Recognized provident fund
IT
 Exemption limit of interest credit to RPF is
 A) 6.5%
B) 9.5%
C) 7.5%
D) None of this
IT
 Taxable amount of perquisite in respect of small car for
offial and personal purpose
 A) 1500 p.m.
B) 1800 p.m.
C) 2400 p.m.
IT
 HRA exempted u/s 10(13A) includes
 A) 40% of salary if accommodation is situated at
Delhi, Mumbai, Chennai, Kolkata
B) 60% of salary if accommodation is situated at Delhi,
Mumbai, Chennai, Kolkata
C) 50% of salary if accommodation is situated at Delhi,
Mumbai, Chennai, Kolkata
IT
 Pension is taxable under which head ?
 A) Capital gains
B) House property
C) Salary
D) All of the above
IT
 Salary received by a Member of Parliament is taxable
under the which head ?
 A) Income from salary
B) Capital gains
C) Income from other sources
IT
 The maximum limit for the claim of deduction under
salary headContributions to certain pension funds of
LIC or any other insurer is .
 A. up to ` 2,00,000
 B. up to ` 1,50,000
 C. up to ` 1,75,000
 D. none of the above
INCOME TAX EXAM
1. The maximum amount on which income tax is not chargeable for the assessment
year 2020-21 in case of a resident individual (less than 60-year-old) is:
(A) Rs. 3,00,000
(B) Rs. 2,50,000
(C) Rs. 2,40,000
(D) Rs.2,00,000
2. The total income of a resident individual (less than 60 years old) for the
assessment year 2020-21 is Rs. 8,00,000. His income tax liability would be as under:
(A)Rs. 1,03,480
(B)Rs. 99,500
(C) Rs. 75,400
(D)Rs. 72,500
3. The rate of Surcharge on income tax for the assessment year 2020-21 is payable
by an individual is:
(A) 5%
(B) 4%
(C) 3%
(D) 2%
4. if assessment year is 2019-20 then financial year is_________
(A) 19-20
(B) 20-21
(C)18-19
(D)21-22
5. if PAN NO AKKC4917C then Status of Assess
(A) Firm
(B) Company
(C) Proprietor
(D) Trust
6. Nirma University (Classify the Definition of Person)
(A) Individual
(B) Local Authority
(C) Body of Individual
(D) An Artificial Individual Person
7. Which of the following is not a casual income?
(A) Mr. S received a prize of RS. 51,000 in a crossword puzzle competition
(B) Mr. G (a notorious gambler) won Rs. 1,00,000 in a card game:
(C) Mr. U received an income of Rs.2,50,000 on sale of old silver coins (no longer
considered legal tender):
(D) Mr. C (a cricketer) received Rs.11,11,111 from a benefit match arranged on
his retirement.
8. Following income taxable for Non Resident
(A) Income Accrue outside India
(B) Income Accrue outside India and received outside India.
(C) Income Received In India
(D) Accrue outside India Remitted to India
9. Bucket was born on 10th September 1982 in India and he later on took, U.S.
citizenship Neither his parents nor his grandparents were born in undivided India.
What would be his residential status for the previous 2019-20, if he comes on a
visit to India for 180 days during the previous year?
(A) Resident and Ordinarily Resident
(B) Resident but not Ordinarily Resident
(C) Non-Resident
(D) Indian
10. Mr. Jotangia born 11th 1993 in India and took U.S. citizenship in 2006. On 01-01-
2019, he came to India for marriage and went back 30-06-2019 to U.S What
would be his residential status for the A.Y.2020-2021?
(A) Resident and Ordinary Resident
(B) Resident but not Ordinary Resident
(C) Non-Resident.
(D) Indian
11. For Resident and Ordinary Resident how many days require to stay in India during 7
years preceding the previous year
(A) 765
(B) 182
(C) 730
(D) 745
12.Indian Citizen Visit to India in previous year required to stay in India
(A) 182
(B) 365
(C) 180
(D) 60
13. Mr.H (not a specified employee) receives annual basic salary or Rs. 48,000 Annual
value of rent – free house (In Surat) provided to him is Rs. 24,000 and gardener’s salary
paid by the employer amounts to Rs. 3,000
What would be the taxable value of perquisite of ‘rent-free accommodation’?
(A) Rs. 7,200
(B) Rs. 9,600
(C)Rs. 12,000
(D)Rs. 15,000
14. Gratuity Received Maximum Exemption Limit Maximum is
(A) 10,00,000
(B) 20,00,000
(C) 30,00,000
(D) 15,00,000
15. Gratuity Received under 1972: - Salary means
(A) Last drawn salary or wages (including D.A)
(B) 10 Month salary
(C) ½ Month Salary X complex year or service
(D) salary + D.A + Commission
16. Mr. C a non-government employee, gets Rs. 1,20,000 as commuted pension in
addition to gratuity at the retirement, the above commuted pension has been
given to him@50% of total commutable pension.
Which of the following is the correct amount of taxable part of ‘commuted
pension’ received by him ?
(A) Rs. Nil
(B)Rs. 40,000
(C) Rs. 60,000
(D)Rs.1,20,000
17.H.R.A: - For Surat City Taken Salary %
(A) 40% salary
(B) 50% salary
(C) 10% salary
(D) 30% salary
18. Children Education allowanced hostel allowanced Exemption
(A) 100 & 300 pm per child Maximum two child
(B) 100 & 300 pm per child Maximum three child
(C) 100 & 300 pm per child Maximum one child
(D) 100 &200 pm per child Maximum tow child
19. Taxable Perquisite
(A) Telephone and Mobile
(B) Training of Employee
(C) Medical Reimbursement
(D) Rent free Accommodation
20. Free Accommodation: - population is more than 10 lakhs but not more than 25 lakh
(A) 7.5 % of salary
(B) 10 % of salary
(C) 15 % of salary
(D) 20 % of salary
21. Motor car owned by employer: - Maintenance and repair met by employer himself
Exemption (motor car exceed 1600CC)
(A) 1800 pm
(B) 2400 pm
(C) 600 pm
(D) 900 pm
22. 80 C deduction allowed in which security
(A) Unrecognized Provided Fund
(B) Equity Share
(C) P.P.F
(D) Kishan Vikas Patra
23. Salary 36,00,000 Cost of furniture 12,00,000 fair rent 9,00,000 value of rent free
Accommodation (city population=9 lakh)
(A) 390000
(B) 270000
(C) 480000
(D) 660000
24. Government Employee Get 4000 Entertainment allowance exemption Rs ( salary
1,00,000)
(A) 20000
(B) 6000
(C) 5000
(D) 4000
25. HRA 60,000 salary 1,20,000 Rent Paid 60,000.(Stay in Mumbai)Taxable Amount is
(A) 48,000
(B) 60,000
(C) 50,000
(D) 12,000
26. Municipal Value 90,000 Fair rent 108000 standard rent 101250 gross annual value
(A) 108000
(B) 101250
(C) 90000
(D) Nil
27. standard deduction From net annual value is

(A) 50,000
(B) 30 %
(C) 40 %
(D) 50 %
28. Loss due to vacancy rent deduction from
(A) step 1
(B) step 2
(C) step 3
(D) step 4
29. step 1= value : 30,000,Rent Received 27000 Loss to vacancy= 9000 unrealised rent
4500 find out gross annual value
(A) 22,500
(B) 30,000
(C) 21,000
(D) 27,000
30. Basic Pay 25,000 pm D.A: 12,000 pm Taxable Salary

(A) 4,44,000
(B) 3,94,000
(C) 3,00,000
(D) 2,50,000
31. Free Education facility in institution owned by employer provided by employee is

exempt ( if Employee three child in institution)
(A) 12,000 per year
(B) 100 per month
(C) 300 per month
(D) 36000 per year
32. When tenant sublet the properly income taxable under heads of
(A) Income from house property
(B) Other sources
(C) business Income
(D) Salary Income
3/24/22, 10:51 AM Income Tax MCQ QUIZ Set-2 (Income from Salary) - Income TaxPe
Income from salary MCQ with answers
1. Computation of income from salary section is
A) Sec 11-12
B) Sec 15-17
C) Sec 6-10
D) Sec 16-20
… Answer is B)
Sec 15-17
https://incometaxpe.com/2020/09/income-tax-mcq-quiz-set-2-income-from-salary.html 2/12
Show Answer
2. Deduction allowed against gross salary

A) Income tax
B) Entertainment tax
C) Professional tax
D) education tax
… Answer is C)
Professional tax
Show Answer
3. RPF full form in income tax

A) Reserve police force
B) Railway police force
C) Recognized provident fund
… Answer is C)
Recognized provident fund
Show Answer
4. Exemption limit of interest credit to RPF is
A) 6.5%
B) 9.5%
C) 7.5%
D) None of this
… Answer is B)
9.5%
Show Answer 5. Employer contribution to RPF is Exempted up
A) 12%
B) 9.5%
C) 19%
D) 10%
… Answer is A)
12%
Show Answer
6. Taxable amount of perquisite in respect of small car for offial and personal purpose
A) 1500 p.m.
B) 1800 p.m.
C) 2400 p.m.
… Answer is B)
1800 p.m.
Show Answer
7. Taxable amount of perquisite in respect of Big car for offial and personal purpose
A) 1800 p.m.
B) 2000 p.m.
C) 1500 p.m.
D) 2400 p.m.
… Answer is D)
2400 p.m.
Show Answer
8. Deduction from salary is allowed u/s

A) Sec 15
B) Sec 16
C) Sec 25
D) None of Above
… Answer is B)
Sec 16
Show Answer
9. Education allowancw is exempted

A) Rs. 200 per month up to 4 child
B) Rs. 200 per month up to 3 child
C) Rs. 100per month up to 2 child
D) Rs. 100 per month up to 10 child
… Answer is C)
Rs. 100per month up to 2 child
Show Answer
10. Medical bil reimbursed in respect of treatment in private hospital

A) Up to 15,000
B) Up to 12,000
C) Up to 25,000
… Answer is A)
Up to 15,000
Show Answer
11. HRA exempted u/s

A) 15(13B)
B) 12(13C)
C) 10(13A)
… Answer is C)
10(13A)
Show Answer
12. Perquisite Comes U/S

A) 19(3)
B) 17(2)
C) 2(17)
… Answer is B)
17(2)
Show Answer
13. Allowance from U.N.O is

A) partly taxable
B) fully taxable
C) fully exempted
… Answer is C)
fully exempted
Show Answer
14. Entertainment allowance is

A) Partly exempted
B) Exempted
C) fully taxable
… Answer is A)
Partly exempted
Show Answer
15. HRA exempted u/s 10(13A) includes

A) 40% of salary if accommodation is situated at Delhi, Mumbai, Chennai, Kolkata
B) 60% of salary if accommodation is situated at Delhi, Mumbai, Chennai, Kolkata
C) 50% of salary if accommodation is situated at Delhi, Mumbai, Chennai, Kolkata
… Answer is C)
50% of salary if accommodation is situated at Delhi, Mumbai, Chennai, Kolkata
Show Answer
16. Free food during working hours at office/ business premises exemopted up to
A) Rs. 50 per meal
B) Rs. 60 per meal
C) Rs. 90 per meal
… Answer is A)
Rs. 50 per meal
Show Answer
17. Agricultural income is

A) Taxable
B) Fully taxable
C) Exempted
D) Partly taxable
… Answer is c)
Exempted
Show Answer
18. Exempted Income comes under section

A) Sec 12
B) Sec 10
C) Sec 24
D) Sec 13
… Answer is B)
Sec 10
Show Answer
19. Sec 10AA deduction implies

A) Buffer zone
B) Special economic zone
C) POK zone
… Answer is B)
Special economic zone
Show Answer
20. Allowance of MP/MLA is

A) Exempted
B) Free
C) Taxable
D) illegal
… Answer is A)
Exempted
Show Answer
Also Read Income Tax MCQ / Multiple Choice Questions on Taxation with Answers :
Income Tax MCQ QUIZ Set-1 (Basic Concept)
Income Tax MCQ QUIZ Set – 3 (Income from Salary)
Income Tax MCQ QUIZ Set – 4 (Income from salary)
Income Tax MCQ QUIZ Set – 5 (Income from Salary)
Income Tax MCQ QUIZ Set – 6 (Income from House Property)
Income Tax MCQ QUIZ Set – 9 (Profits and Gains from Business or Profession)
Income Tax MCQ QUIZ Set – 10 (Profits and Gains from Business or Profession)
Income Tax MCQ QUIZ Set – 11 (Income from Capital Gains)
questions answer1 answer2 answer3 answer4 correct
Income Tax Act was passed in the year 1934 1956 1961 1972 3
Professional
Income tax is a
tax Direct tax Indirect tax Service tax 2
There are …………… heads of income 3 4 5 2 3
Previous Assessment
Section 2(9) of Income tax deals with
Person Assessee Year Year 4
Assessment year is the period of 12 months commencing
from ……………. Every year. 1st March 31st March 1st April 31st April 3
Local All of the
As per Income tax Act, Person includes
Individual HUF Authority above 4
Citizen’s Citizen’s
CBDT stands for Central Bureau Central Board Board of Bureau of
of Direct Taxes of Direct Taxes Direct Taxes Direct Taxes 2
One Basic Both Basic
Both Basic One Basic Condition Conditions
To be an Ordinarily resident in India, an individual must
Conditions and Condition and and One and Both
satisfy
One Additional Both Additional Additional Additional
Condition Conditions Condition Conditions 2
A citizen of India who goes abroad for the purpose of
employment, he must stay in India in the previous year
for at least ............................. days to become a resident 90 days 162 days 180 days 182 days 4
Income from Salary is explained in the section 12 to 14 15 to 17 18 to 22 24 to 26 2
Fully None of
Bonus paid by the employer to the employee is
Fully Taxable Partly Taxable Exempted these 1
Gratuity is defined as per section 10(10A) 10(10AA) 10(10) 10A 3
Entertainment allowance is allowed as a deduction as per
section 16 16(i) 16(ii) 16(iii) 3
Children education allowance is exempt up to per month
per child for two children. Rs. 100 Rs. 150 Rs. 200 Rs. 250 1
City
State which of the following income are exempted? Dearness Compensatory Foreign Medical
Allowance Allowance Allowance Allowance 3
Commission Free
The following is not taxable as income under the head received by a Remuneration Allowances accommodati
"Salaries". full time received by a received by on given to
director partner an employee an employee 2
Previous year means the financial year immediately Accounting Assessment All of the None of the
preceding the Year Year above above 2
The value of Interest free concessional loans to
employees is determined on the basis of lending rates
of ..................... for the same purpose. S.B.I. R.B.I. Central govt. State govt. 2
Interest on RPF balance is exempted up to 9.75%. 9.5%. 10%. 12%. 2
The Payment of Gratuity Act came into force in 1973 1980 1991 1972 4
Free food provided to employees is exempted
upto ...................... per meal. Rs: 40 Rs: 50 Rs: 60 Rs: 15 2
adding
Income
under five
heads of
adding Income, after
Income applying
under five clubbing
heads of provisions
Gross Total Income is arrived after ………… Income, after and making
applying adjustment of
clubbing set off and
adding Income provisions carry forward
under five and making of losses and
only adding heads of adjustment of after allowing
Income under Income set off and deduction
five heads of excluding carry forward undersection
Income losses of losses 80Cto80U 4
Gift to employee up to ……………………… p.a. will not
be treated as perquisite taxable in the hands of
employee. 4,000 5,000 10,000 2,500 2
Under the head Income from House Property the basis of Gross Annual Municipal
charge is …… Rent Received Value Annual Value Value 3
Municipal Municipal
taxes paid by taxes paid by
Which of the following is deductible from the annual value
Municipal taxes the owner for the owner
of HP?
Municipal paid by the the previous during the
Taxes paid owner year previous year 4
Mr. Ram owns a house property. He lent it to Laxman at `
10,000 p.m. Laxman sublet it to Mr. Maruti on monthly Income from
rent of ` 20,000 p.m. Rental income of Ram is taxable Income from Income from House Income from
under the head ……… Salary Other Sources Property Business 3
A sum equal to …………… is allowed as deduction from
the annual value. 15% 20% 25% 30% 4
Municipal
value of Fair
Municipal value
What is expected rent? value of Fair Municipal value whichever is
value of Fair value higher
whichever is whichever is subject to None of
lower higher standard rent these 3
Interest on capital, borrowed on 10.10.2000, for
self-occupied property is deductible up to a maximum None of the
amount of ………… 50,000 150,000 5,000 above 2
Rent Free Accommodation given to an employee by the Profit in lieu None of the
employer is a …… Allowance Perquisite of salary above 2
What of the following taxes is applicable in the case of
supply of goods from Gujarat to Assam? CGST SGST UTGST IGST 4
Central Excise
Which of the following taxes have been subsumed in
Central Sales Duty and Value Added
GST?
Tax Service Tax Tax All of Above 4
Who shall be empowered to levy and collect GST on
supplies in the course of Inter state Transactions of trade Central State Union All of the
or commerce? Government Governments Territories above 1
1st January 1st March
GST was implemented in India from
2017 1st April 2017 2017 1st July 2017 4
GST is a consumption of goods and service tax based on Development Dividend Destiny Destination 4
The maximum rate for CGST is? 28 12 18 20 4
Central Govt
in
Tax rate on goods under GST are determined by consultation
with state
Union budget State budget GST council Govt. 3
CGST plus
The rate of IGST is equal to the rate of the rate of SGST plus
CGST SGST SGST UTGST 3
Both supply
and
Goods and service tax is –
Consumption consumption None of
Supply based based based these 2
GST was introduced in India with effect from 1.1.2017 1.4.2017 1.1.2018 1.7.2017 4
Goods are
Goods are sold sold by a
SGST is applicable when from one GST GST dealer
Goods are sold dealer to a to another Interstate
within a state customer GST dealer supply 1
The maximum limit of IGST rate fixed in the Act is 18% 28% 40% 100% 3
Equally to
selling state
Half share of IGST moves always to
and buying None of
Selling state Buying state state these 2
A is entitled to children education allowance @ Rs. 80
p.m. per child for 3 children amounting Rs. 240 p.m. It will
be exempt to the extent of : Rs.200 p.m. Rs.160 p.m. Rs. 240 p.m. Rs. 120 p.m. 1
Private sector Public sector Government All of the
The entertainment allowance is applicable to………
employees employees employees above 3
The death-cum-retirement gratuity received by the
Government Employee or employee of local authority is Partially None of the
………… exempted Fully exempted Half taxable above 2
Income from Income from
Which amongst the following is not a head of Income?
Salaries house Property Capital gains exports 4
Remuneration
paid to the Commission
Which of the following is not taxable under the head lecturer of a received by
Salary? college for Salary received an employee
setting a by a member director of a Both (a) and
question paper of parliament company (b) 4
Value of rent free accommodation a house owned by 10% of 15% of 7.5% of 20% of
employer in case of non- Govt. employees with above 25 employees employees employee employees
lakhs population is....... salary salary salary salary 2
Incomes
exempted
The Income TaxAct,1961 broadly covers ……………
Basic charging Rebates and from income All of the
income reliefs tax above 4
Income tax
Income tax rates are fixed in……
Income tax Act Finance Act rules Finance rules 2
A person with the age of ………… or more is considered
as a super senior citizen as per Income tax Act. 56 60 80 85 3
Previous Assessment
Section 2(9) of Income tax deals with……
Person Assessee Year Year 4
When the income earned in an year is taxed in the same Advanced Super Accelerated None of the
year, it is called Assessment Assessment Assessment above 3
Educational cess is charges at the rate of ……. 2% 1% 3% 5% 3
A Company has …………. types of residential status. 2 3 1 4 1
Salary is defied as per section ……… 15(2) 16(1) 17(2) 17(1) 3
Payment made by an employer to employee monthly, None of
other than salary is called ……… Bonus Allowances Benefits these 2
Fully None of
If the assessee is living in own house HRA is ………….
Fully Taxable Partly Taxable Exempted these 1
Children hostel allowance is exempt up to per month per
child for two children. Rs. 100 Rs. 200 Rs. 250 Rs. 300 4
Hindu
Who among the following may be “not ordinarily
Undivided Association None of
resident”?
Family. Company. of persons. these 1
The periodic payment of money for the past service is Commuted
known as .............. Gratuity Pension pension Leave salary 2
Income received in India whether occurred in India or
outside India, the tax incidence in case of resident is Taxable as per Exempted from Partly None of the
……… slabs tax exempted above 1
Profits and
Salary received by a Member of Parliament is taxable gains of
under the head.............. Income from business or Income from
salary Capital gains profession other sources 4
Resident and
Income received in India is taxable in the hands of ordinarily Non-resident All
Resident only. resident only. only. assessees. 4
Govt, itself
Tax is to be No tax is Tax is to be pays the tax
In case of Tax free salary,
paid by payable on paid by the at a future
employer such salary employee date 1
Govt Non Govt All None of
Dearness allowance is taxable in the hands of
employees employees employees these 3
Perquisites to employees are covered in the I.T. Act 1961
under Sec 2a Sec. 17b Sec 28a Sec. 36 c 2
15% of 7.5% of 10% of
Value of rent free accommodation in case of Govt.
employees employees License fee employees
employee shall be taxable up to
salary salary fixed by Govt salary 3
Employers contribution to RPF is exempted up to 10% of salary 13% of salary 12% of salary 11% of salary 3
Immediately Immediately
succeeding preceding
The income of previous year is chargeable to tax in the
assessment Same previous academic None of the
year year year above 1
The salary, remuneration or compensation received by Income from Income from None of the
the partners is taxable under the head Other Sources Business Salary above 2
The assesses can claim relief under
………………………… for arrears or advance salary. Section 89(1) Section89(2) Section 89(3) Section89(4) 1
Medical reimbursement is exempt upto .................. if
treatment is done in a private hospital. Rs: 5,000 Rs: 10,000 Rs: 15,000 Rs: 50,000 3
Any fees,
commission,
perquisite or
In accordance with the provisions of Section 17(1) of profits in lieu
Income Tax Act, 1961, the term salary includes of or in
addition to
Any annuity or any salary or All of the
pension Any gratuity wages above 4
Not from
If the employee receives retirement gratuity from more
Current Previous Both single
than one employer, he can claim exemption in respect of
employer employer employer employer 3
Exempted after
The family pension received by the family members of fulfilling of
armed forces after death of employee is certain Not None of the
Exempt fully conditions exempted above 2
Employer provides a car (below 1.6 ltr capacity) along
with a driver to X partly for official and partly for personal
purpose. The expenses incurred by the company are:
running and maintenance expenses – ` 32,000 and
driver’s salary – ` 36,000 . Taxable value of perquisite is 21,600 10,800 32,400 39,600 3
Actual cost
less Actual Actual
depreciation Actual costless costless costless
@30% for depreciation depreciation depreciation
If an employer transfers second hand motor car to the
every @20% for @30% for @20% for
employee, the perquisite is valued at
completed every every every
year under completed year completed completed
straight line under WDV year under year under
method method WDV method SLM method 4
Any benefits attached to an office or position in addition None of
to salary or wages is called Allowances Perquisites Benefits these 2
Foreign house property’s income is taxable only in the Not OrdinarilyOrdinarily None of the
case of Non Resident Resident Resident above 2
Annual value is defined as per section 21(1) 22(1) 23(1) 24(1) 3
Deducted
The tax paid by the tenant is Added to rent from rent Added to
received No adjustment received Annual value 2
Equal to
If the house remains vacant for the whole year, annual
Municipal Equal to Fair None of the
value will be
Value rent Nil above 3
A sum equal to 30% is allowed as deduction from the Standard Basic None of the
annual value as Deduction Deduction Deduction above 2
Interest on loan taken for which all purposes are All of the
deductible from annual value? Purchase Repair Construction above 4
Deductions from annual value is as per section 22 24 26 24A 2
Interest for pre-acquisition period is deductible in
………………. instalments 3 4 5 7 3
Equal to
Annual value of self-occupied house is Municipal Equal to Fair None of the
Value rent Nil above 3
The balance of unabsorbed loss from HP can be carry None of
forward to a maximum of …….. years. 6 7 5 these 2
In case of disputed ownership, income from HP is Recipient of None of the
chargeable in the hands of income Not assessible All owners above 1
An individual who transfers house property without an
adequate consideration to his owner spouse or to minor Deemed Owner None of the
child is called as Co-owner Owner Himself above 2
The Gross annual value of the property is depends upon Municipal All of the
the Standard rent Valuation Fair rent above 4
Mr. Shushant is the owner of a house, the details of
which are given below the gross annual value would be
……………... Municipal value ` 36,000 Actual rent `
32,000 Fair Rent` 36,000 Standard Rent` 40,000 36,000 35,000 30,000 40,000 1
Interest on loan for self-occupied house taken before 1st
April, 1999 will be allowed up to 30,000 150,000 10,000 50,000 2
Interest on
Deduction allowed from annual value is loan for Interest on Statutory All of the
constitution loan for repair deduction above 4
None of the
If fair rent is not given, then assume ………… as fair rent.
Actual rent Standard rent Average rent above 1
Profit and
Income from Profits from Gains from
Identify the correct head
business and business and business and None of
profession profession profession these 3
Purchase price Written down Market price
Under the Income Tax Act, 1961, depreciation on
of the value of the of the All of the
machinery is charged on
machinery machinery machinery above 2
Which of the following taxes is applicable in the case of
supply of services from Bihar to Rajsasthan? CGST SGST UTGST IGST 4
India‘s GST structure are based on how many
structures? 6 4 3 5 2
The maximum rate for SGST/UTGST is? 28 14 20 30 3
The maximum rate for CGST/ITGST is? 28 14 20 30 1
Which code is used to classify goods and services under SAC/HSN
GST? HSN Code Code GST Code SAC Code 2
What does ?I? in IGST stands stand for? Internal Intregrated Internal Intra 2
For A.Y. 2020-21 Standard Deduction is allowed is Rs 40,000 50,000 50,500 Not Allowed 3
Entire
Maximum deduction available for Professional tax is Rs. There is no amount paid
5000 2500 limit at all by employer 2
Employee of
Deduction in respect of H.R.A. Sec 10(13A) is available to Government Private sector local All of the
employee employee authority above 4
Tribal area allowances are exempted to extent of 200 p.m 800 p.m. 2000 p.a 600 p.a. 1
A motor car (CC of engine is 1.8 litters) is provided to Mr.
X .The motor car is used both for the private and official
work. Expenses on maintenance of private use are borne
by Mr. X. Taxable amount is 900 p.m. 2400 p.m 1800 p.m. 1200 p.m. 1
Exempt up to Exempt up to Fully
Gift in cash is ..
. Fully Taxable Rs. 5000 Rs.10000 Exempted. 1
Mr. X has two house properties, both are self-occupied. One House will Both House will No House will None of the
The Gross Annual Value for A.Y. 2020-21: be Nil be Nil be Nil above 2
The Fair Rented value of a house is Rs.1,50,000,
Standard Rent 1,20,000, Actual Rent Rs.1,30,000. The None of the
Gross Annual Value will be. 1, 50,000 1, 20,000 1, 30,000 above 3
Amount of
rent payable
Amount of rent Amount of rent neither
Unrealized rent is equal to
payable but payable and payable nor
not paid by a paid by a paid by None of the
tenant. tenant. tenant. above. 1
Monetary
and
non-monetar
Monetary and Monetary and y benefits
Income from Salary includes
non-monetary non-monetary paid by
benefits due benefits paid to partnership
from employer employee by firm to its None of
to employee the employer partners above 3
Mr Y is given Rs 6000 pm as additional amount along
with basic salary for the purpose of meeting the cost of
travel between the office and his residence. Rs 72000/- None of
should be shown as Perquisite Allowance Bonus above 2
“Salary” includes Basic pay + DA (part forming for Rent free
retirement benefit) + commission at fixed % in the accommodatio House Rent None of
calculation of n Allowance Both above 2
Basic Pay + Basic Pay +
DA + Bonus + DA + Bonus +
Salary for the purpose of employer’s contribution to RPF
Basic Pay + DA Commission Commission
includes
+ fixed % of + All taxable + All taxable
Basic Pay Commission Allowances Perquisities 2
Employer’s contribution to the following ---------------
provident fund is fully exempt from tax Recognized Unrecognized Statutory Public 3
Servant Child
Allowance, Education
Tiffin Allowance,
Following are examples of fully Taxable Allowances
Allowance, Hostel
Fixed Medical Expenditure
All of the None of
Allowance. Allowanceabove above 1
Mr. Fernandes an employee of a semi- Government firm Rupees Ten
received Hostel allowance of Rs 15000/- for his three Rupees Seven Thousand
children. What amount of exemption can he claim under Rupees Fifteen Thousand Two Eight
hostel expenditure allowance? Thousand p.a Hundred p.a Hundred p.a Nil 2
Rent received Rent received
from the from the
The following cannot be shown as income from house
Residential flat vacant plot
property
owned by Mr. owned by Mr. A
A, in Mumbai in Pune Both None 2
Gross Annual
Gross Annual Gross Annual Value –
Net Annual Value = Value – Value – Interest on
Standard Municipal borrowed
Deductions Taxes capital All of above 1
Reasonable
Reasonable Reasonable expected rent
Expected Rent expected rent is higher of
is higher of is higher of Fair Rent or
Which is the correct statement, in regards to computation
Municipal Municipal Standard rent
of Gross Annual Value of a House Property
value or fair Value or but not
value but not Standard rent higher than
higher than but not higher Municipal
standard rent than Fair Ren Value None 1
R is achattered accountant is employed with Raj Ltd. as
an internal auditor and requests the employer to call the Profit or gain
remuneration as internal audit fee. R shall be chargeable Income from from business Income from Any of the
to tax for such fee under the head Salary or profession other sources above 1
A was employed on 1.7.2014 in the grade of Rs.
15,000-400-17,000-500-22,000. His gross salary for the
A.Y 2020-21 shall be 199200 204000 208500 202800 4
average
An employee is covered under Payment of Gratuity Act,
salary of last average
1972: Salary for the of calculating 15 days salary for each
last drawn average salary 3 completed salary of last
completed year of service shall be:
salary of 10 months years 12 months 1
commission if it
For purpose of calculating exemption of gratuity, salary is a fixed
shall include: fixed percentage of both of the none of
commission turnover above above three 2
Un-commuted pension received by the Government partially none of
employee is, Exempt taxable taxable above 2
The maximum exemption in case of leave encashment
shall be, 240000 350000 300000 1000000 3
X is entitled to Rs.6,000 as medical allowance. He
spends Rs. 4,000 on his medical treatment and Rs.1,000
on on medical treatment of his major son not dependent
on him. The exemption in this case shall be, 4000 5000 Nil 6000 3
Salary of a Government employee is Rs.2,00,000. Fair
rent of unfurnished house situated in Delhi given to
employee is Rs.1,30,000. The valuation of Perquisite of License fee
house shall be, 20000 50000 fixed by Govt 130000 3
employee both
Z owns a house I which he lives.His employer reimberses
other than specified and
to him the eletricity bill amounting Rs.5,000. It shall be a
specified specified other
perquisite for:
employee only employee empolyee none 3
The valuation of perquisites for the facility of Watchman, actual wages
Sweeper and Gardener provided to the employees shall paid to each Rs.120p.m. per Rs.60p.m.
be servant servant per servant Nil 1
exempt upto
Employers contribution towards statuatry fund shall be exempt upto 9.5% of
fully exempted 12% of salary salary taxable 1
exempt upto exempt upto
Intrest credited to statutary fund is
fully exempted 8.5% of salary fully taxable 9.5% 1
neither
exempted
Employers contribution to unrecognised providend fund
nor taxable in
shall be subject to:
exempt upto the year of
fully taxable Fully exempted 9.5% contribution 4
deduction
under
employees contribution to UPF shall be subject to deduction deduction section16
under section under section from gross
80C 80CCC nil deduction salary 3
actual
amount spent
Tea and snacks are provided by X Ltd. to its employees by employer
in the office during office hours. The value of this less amount
perquisite shall be recovered nil if it is upto
nil if it is upto from the Rs.100 per
nil Rs.50 per meal employee day 1
a perquisite in
the hands of
An employer has made a gift of Titan Watch worth Rs. employee and a perquisite a perquisite
12,000 to his employee. Such gift shall be value of such and its value and its value
perquisite shall shall be Rs. not be a shall be Rs.
be Rs.12,000 7,000 perquisite 2,000 2
investment to
acquire
something of
What dose tax avoidance means? legal value with the
minimisation of legal attempt to expectation
the impact of escape the that it defers none of
yaxation impact of taxes taxes above 1
income of
person leaving
India
Which of the following are exemption of the previous permanently,
year? with no
intention of when
When business returning to assessee
is shut down India dies both (1) & (2) 4
Mr. A owns a house property, which is let out on a
monthly rent of Rs.3,000. The annual value of which as
per muncipal valuation is Rs.27,000 and fair rent is Rs.
33,000. Standard rent determined under Rent Controll
Act is Rs.2,825 p.m.what would be the Gross annual
value of the let out house property? 27,000 33,000 33,900 36,000 4
Mr.Satyam is owner of only one house. It is self occupied.
Fair rent Rs.25,000, Municipal Assessment Rs.30,000,
local taxes Rs. 2,000 and intrest on loan for construction
Rs.5,000. His taxable income from house property would
be 14,600 (-5000) 23,000 nil 2
registration
for each
branch
If an entity has multiple branches within the same state , multiple or separately, if
it requires single single turnover of
registration of registration for registration at each branch
each branch all the the option of exeeds Rs.
separetly branches assessee 1.5 crore 2
inter state
supplies and
export oh
"Aggregate Turnover" means the aggregate value of-
goods or
taxable exempted services or all of the
supplies supplies both above 4 27
………… of Income Tax Act is related to residential status section 2 section 6 section 5 section 4 2
Section ……… of Income Tax Act, 1961 defines the term
person 4 2(31) 5 2(32) 2
The way of tax liability by taking full advantage provided Tax
by the Act is management Tax avoidance Tax planning Tax evasion 3
Under section 15 of Income Tax Act, the salary due in
previous years and even if it is not received partially none of
is……………….. taxable not taxable taxable above 1

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B COM SEMESTER 5- MCQ

1. Income Tax Act was passed in the year……….

A) Tax-free under section 10(10D) B) Fully taxable as income

C) Rs.` 2,70,000 is taxable D) Rs.` 2,30,000 is taxable

A) Cost price B) Market price

C) Cost or market price, whichever is less D) Cost or market price, whichever is

164. Export Incentives taxable under this head includes:

 1 . IGST is payable when the supply is ........

 1 Maximum rate of CGST prescribed by law for

27. standard deduction From net annual value is

30. Basic Pay 25,000 pm D.A: 12,000 pm Taxable Salary

31. Free Education facility in institution owned by employer provided by employee is

Income from salary MCQ with answers

1. Computation of income from salary section is

2. Deduction allowed against gross salary

3. RPF full form in income tax

B) Railway police force

C) Recognized provident fund

D) None of the above

Recognized provident fund

4. Exemption limit of interest credit to RPF is

Show Answer 5. Employer contribution to RPF is Exempted up

D) None of the Above

8. Deduction from salary is allowed u/s

9. Education allowancw is exempted

B) Rs. 200 per month up to 3 child

C) Rs. 100per month up to 2 child

D) Rs. 100 per month up to 10 child

Rs. 100per month up to 2 child

10. Medical bil reimbursed in respect of treatment in private hospital

D) None of the above

11. HRA exempted u/s

D) None of the above

12. Perquisite Comes U/S

D) None of the above

13. Allowance from U.N.O is

D) None of the above

14. Entertainment allowance is

D) None of the Above

15. HRA exempted u/s 10(13A) includes

B) 60% of salary if accommodation is situated at Delhi, Mumbai, Chennai, Kolkata

C) 50% of salary if accommodation is situated at Delhi, Mumbai, Chennai, Kolkata

D) None of the Above

50% of salary if accommodation is situated at Delhi, Mumbai, Chennai, Kolkata

B) Rs. 60 per meal

C) Rs. 90 per meal

D) None of the above

Rs. 50 per meal

17. Agricultural income is

18. Exempted Income comes under section

19. Sec 10AA deduction implies

B) Special economic zone

D) None of the above

Special economic zone

20. Allowance of MP/MLA is

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