1. Concealment of income or false claims to reduce tax liability are cases of ------
Correct : A. Tax evasion
2. Using the loopholes of law to reduce tax is known as
Correct : C. Tax avoidance
3. ------ is the device which satisfies the requirements of the law but not in accordance with the
intentions of the law
Correct : C. Tax avoidance
4. Reducing tax liability, utilizing the deductions, exemptions or reliefs allowed in the Act and
Rules is called----
Correct : B. Tax planning
5. Compliance of the legal requirements in connection with the tax is the essence of -----
Correct : D. Tax management
6. Tax avoidance is ----
Correct : B. Immoral
7. Availing tax holiday by a new industrial undertakings in backward areas is a case of
Correct : B. Tax planning
8. Compliance with legal formalities and availing tax incentives are cases of
Correct : D. Tax management
9. Return of income must be furnished on or beforethe due date as per a part of-----
Correct : D. Tax management
10. The total income of a domestic company is taxable at the rate of -------
Correct : B. 30%
11. The total income of a non domestic company is taxable at the rate of----
Correct : C. 40%
12. Under the Income-tax Act, 1961, which of the following outlays incurred by Sun Ltd. during the
previous year ended 31st March, 2019 will not be admissible as deduction while computing its business income
Correct : D. All of the above
13. Any corporation by or under any Central, State or Provincial Act or a Government Company as
defined in the Companies Act is called -----
Correct : A. Public Sector Company
14. Any company which has made the prescribed arrangements for the declaration and payment of dividends within India is called ------
Correct : A. Domestic Company
15. A company which is neither an Indian company not has made the prescribed arrangements for
the declaration and payment of dividends within India is called -----
Correct : B. Foreign Company
16. A company in which the public are not substantially interested is closed------
Correct : B. Closely held company
17. A person carrying not less than----- of the voting power in a company is said to have substantial
interest in the company.
Correct : B. 20%
18. Section 115JB relates to ----
Correct : C. Minimum Alternative Tax
19. Under the Income Tax Act, 1961, depreciation on machinery is charged on ………
Correct : B. Written down value of the machinery
20. If the tax liability of a company is less than 18.5% of its book profits, the company is liable to
pay MAT at the rate of ------
Correct : D. 18.5% of books profits plus Surcharge(if any) plus 4% HEC
21. A company carry forward the eligible tax credit under MAT for a maximum of -----
Correct : C. Ten assessment years
22. The rate of corporate dividend tax during the year 2018-19 is ------
Correct : A. 17.674% + 12% surcharge + 4% HEC
23. Income distributed by a money market mutual fund or liquid fund is taxable @------
Correct : C. 25% + Surcharge 10% + 4%HEC
24. Income distributed by a fund other than a money market mutual fund or a liquid fund to an
individual or HUF is subject to CDT at the rate of
Correct : A. 12.5% + Surcharge 10% + 4 % HEC
25. Under the head Income from House Property the basis of charge is ……
Correct : C. Annual Value
26. Tonnage tax system is exclusively intended to ------
Correct : C. Sipping companies
27. Which among the following is not available to companies?
Correct : B. 80 C
28. MAT Provisions are applicable to----
Correct : D. Every Company
29. Which among the following is not a widely held company
Correct : B. Private Limited Company
30. Substantial interest in the company means not less than---- of voting power
Correct : B. 20%
31. Section 115JB relates to
Correct : C. MAT
32. The Income Tax Act came into force from _______________
Correct : D. 1st April 1962
33. An assessee paid insurance premium against risk of damage or destruction of stocks or stores used for the purposes of his business or profession. Such expenditure shall be considered as
Correct : A. Revenue expenditure
34. _______________ is the casual income.
Correct : D. Winning from lotteries
35. Pension is _______________ under the salary head.
Correct : A. Fully taxable
36. salary of Member of Parliament is taxable under the head _______________
Correct : B. Income from Other Sources
37. The salary, remuneration or compensation received by the partners is taxable under the head -----
Correct : B. Income from Business
38. In accordance with the provisions of Section 17(1) of Income Tax Act, 1961, the term salary
includes _______________
Correct : D. All of the above
39. Under the Income-tax Act, 1961, 'notional profit' from speculative business is –
Correct : B. Taxable under the head 'income from other ' sources'
40. The books of accounts are to be kept and maintained for a period of how many years from the
end of the relevant assessment year.
Correct : A. 6 years
41. Alternate Minimum Tax shall not be applicable to a non-corporate assessee who has claimed any
deduction under:
Correct : B. section 80P
42. Under the Income-tax Act, 1961, interest on capital received by a partner from a partnership firm
is chargeable under the head
Correct : A. Profits and gains of business or profession
43. The employer made a contribution of Rs 25,000 to recognized provident fund for the previous
year 2018-19. Such payment was made on 12th March, 2019. Such expenditure shall be considered as
Correct : A. Revenue expenditure
44. Income tax rates are fixed in……………..
Correct : B. Finance Act
45. Section 2(9) of Income tax deals with…………..
Correct : D. Assessment Year
46. CBDT stands for …………………………..
Correct : B. Central Board of Direct Taxes
47. Dividend from an Indian Company is …………………
Correct : C. Fully Exempted
48. Previous year means the financial year immediately preceding the…………………...
Correct : B. Assessment Year
49. ………… is exempted from income tax.
Correct : D. Dividend from Indian company
50. Profits earned from an illegal business are...............
Correct : A. Taxable.
51. Subletting is assessable under the head …………………
Correct : B. Income from Other Source
52. Preliminary expenses incurred are allowed deduction in:
Correct : B. 5 equal annual instalments
53. Educational cess is levied in case of ………..
Correct : D. All assesses
54. As per section 2(31), the following is not included in the definition of 'person'
Correct : D. A minor
55. Amendments by the finance act are made applicable from
Correct : A. First day of next financial year
56. Assessee is having stock existing in the business. Valuation of stock will be at:
Correct : C. Cost or market price, whichever is less
57. Which is the charging section of income under the head profits and gains of business or
profession?
Correct : C. Section 28
58. Which of the following taxes are allowed as deduction while computing the business income?
Correct : C. Sales tax
59. As per section 30, which expenditure incurred for a building used for the business or profession
shall not be allowed as deduction?
Correct : D. Capital expenditure
60. .Group of assets falling within a class of assets comprising of tangible & intangible assets is
known as :
Correct : B. Block of assets
61. A short term capital asset means a capital asset held by the assesse for not more than
Correct : C. 36 Months immediately preceding the month of its transfer
62. -------- are treated as agricultural income
Correct : D. All of these
63. Long term capital loss can be set off against -----
Correct : C. Long term capital gain
64. Clubbing of income means
Correct : B. Inclusion of income of other person in assessee’sincome
65. Income from horse race falls under the head
Correct : B. Other sources
66. Which of the following is not taxable under the head income from other sources?
Correct : C. Rent received on letting of business
67. PAN stands for
Correct : B. Permanent Account Number
68. Donation is deductible under section
Correct : D. 80 G
69. Return filed after the due date is called
Correct : C. Belated return
70. Tax deduction available to certain industries for the initial few years is called-----
Correct : A. Tax Holiday
71. An assessee was engaged in the business of cattle rearing. He incurred a loss in respect of
animals which were used for the purposes of his business (otherwise than as stock-in trade) and which have died. Such expenditure shall be considered as
Correct : A. Revenue expenditure
72. The loss from speculation business can be set off against
Correct : D. Speculative business only
73. Minor’s income is clubbed to -----
Correct : C. Father’s income or mother’s income whichever is grater
74. ------ deals with PAN
Correct : B. Section 140 (A)
75. ------ is a casual income
Correct : D. Winning from lotteries
76. An assessee was engaged in the business of dealing in commodities. He had paid Commodities transaction tax of Rs.15,000 in respect of the taxable commodities transactions. Income arising of Rs 3,00,000 from such taxable commodities transactions was included in the income computed under the head "Profits and gains of business or profession”. Such expenditure of payment of Commodities transaction tax shall be considered as
Correct : A. Revenue expenditure
77. --------- is the implementation of the plan of tax
Correct : C. Tax management
78. Which of the following is an objective of tax management?
Correct : C. Compliance with legal formalities
79. The method by which a person illegally reduces his tax burden by either deflating their income or
inflating their expenses is known as
Correct : B. Tax evasion
80. ------ refers to hedging of tax?
Correct : D. Tax avoidance
81. Company is defined under
Correct : A. Section 2 (17)of the Income Tax Act
82. Whichof the following deals with Domestic Company?
Correct : B. Sec 2 (224)
83. Section 2 (234) relates to
Correct : C. Foreign company
84. A company in which the public is not substantially interested is known as
Correct : C. Widely held company
85. Section 80 JJAA deals with
Correct : C. Deduction in respect of employment of new employee
86. Expenditure incurred by an hotelier on replacement of linen and carpets in his hotel. Such
expenditure shall be considered as
Correct : A. Revenue expenditure
87. The maximum deduction available under section 80 C is
Correct : C. Rs150000
88. The Presumptive Taxation Scheme of Section 44 AD can be adopted by
Correct : D. All of these
89. Deemed dividend is defined in
Correct : A. Section 2 (22)(a)
90. 80 ID deals with tax holiday for
Correct : B. Hotels
91. An assessee incurred expense of tax on non monetary perquisites of employees. Such expenditure shall be considered as
Correct : D. Expressly disallowed
92. Flat rate of corporate tax for a domestic company with annual turnover up to Rs250 crore is
Correct : B. 25%
93. Flat rate of corporate tax for a domestic company with annual turnover more than Rs250 crore is
Correct : C. 30%
94. Flat rate of corporate tax for a foreign company is
Correct : D. 40%%
95. Which of the following shall not be regarded as capital asset?
Correct : B. Rural Agricultural land
96. Which of the following is not a capital expense?
Correct : C. Commission to employees to achieve sales Targets.
97. Which of the following donations is eligible for 100 % deduction?
Correct : B. National DefenceFund
98. Indexation is applicable to.......................
Correct : D. Sale of long term capital assets which are not depreciable assets
99. XYZ & Co. incurred a liability by giving discount on issue of debentures. Such expenditure
shall be considered as
Correct : B. Deferred revenue expenditure
100. The objectives of tax planning is to minimise .........?