Income Tax Law And Practice Set -4

income tax law and practice mcq
Quiz 1 2 3 4 5 6 7 8

Question 1. Income of political parties is not to be included in total income if certain conditions are satisfied. The relevant section of IT Act 1961 is ______________.

(A) Sec.88G.

(B) Sec. 233B.

(C) Sec. 10D.

(D) Section 13A .

View Answer
(D) Section 13A .

Question 2. Tax Holiday is ______________.

(A) Income tax on holiday income.

(B) Tax exemption for a specified period.

(C) Cancellation of tax for the entire country.

(D) None of the above.

View Answer
(B) Tax exemption for a specified period.

Question 3. The existing Maximum Marginal Rate of tax of an individual assessee is ______________.

(A) 35%

(B) 30%

(C) 20%

(D) 10%

View Answer
(B) 30% 

Question 4. Which of the following is not included in salary income.

(A) Leave salary

(B) Family pension

(C) Un commuted pension

(D) Commuted pension

View Answer
(B) Family pension

Question 5. Share of income from firm is ______________.

(A) Taxable in the hands of partner.

(B) Exempted in the hands of firm.

(C) Exempted in the hands of partner.

(D) None of these.

View Answer
(C) Exempted in the hands of partner.

Question 6. Casual income is ______________.

(A) Fully taxable.

(B) Fully exempted.

(C) Partly taxable.

(D) None of these.

View Answer
(A) Fully taxable.

Question 7. In case of Tax free salary, ______________.

(A) Govt, itself pays the tax at a future date.

(B) Tax is to be paid by the employee.

(C) No tax is payable on such salary.

(D) Tax is to be paid by employer.

View Answer
(D) Tax is to be paid by employer.

Question 8. Salary received by a member of parliament is ______________.

(A) Taxable as salary income

(B) Taxable as income from other sources.

(C) Exempt from tax sources.

(D) None of these.

View Answer
(B) Taxable as income from other sources.

Question 9. Allowances received by a government employee posted abroad are ______________.

(A) Taxable by the country where posted.

(B) Fully taxable.

(C) Partly exempted.

(D) Fully exempted.

View Answer
(D) Fully exempted.

Question 10. Dearness allowance is taxable in the hands of ______________.

(A) Govt employees

(B) All employees.

(C) Non Govt employees

(D) None of these.

View Answer
(B) All employees.

Question 11. House rent allowance is ______________.

(A) Actual rent paid alone is taxable.

(B) Fully taxable.

(C) Partly taxable.

(D) Fully exempted.

View Answer
(C) Partly taxable.

Question 12. Exempted limit of HRA in metropolitan cities is ______________.

(A) 50% of salary.

(B) 15% of salary. D

(C) 40% of salary.

(D) None of these.

View Answer
(A) 50% of salary.

Question 13. Education allowance is exempted for a maximum of ______________.

(A) Four children.

(B) Three children.

(C) Two children.

(D) One child.

View Answer
(C) Two children. 

Question 14. Children education allowance is exempted up to ______________.

(A) Rs. 400 p.m. per child.

(B) Rs. 100 p.m. per child.

(C) Rs. 300 p.m. per child.

(D) Rs. 200 p.m. per child.

View Answer
(B) Rs. 100 p.m. per child.

Question 15. Hostel expenditure allowance is exempted up to ______________.

(A) Rs. 250 per month per child.

(B) Rs. 150 per month per child.

(C) Rs. 200 per month per child.

(D) Rs. 300 per month per child.

View Answer
(D) Rs. 300 per month per child.

Question 16. Entertainment allowance to govt. employees is exempted, which is least of 20% of basic salary or actual allowance or ______________.

(A) Rs. 5,000.

(B) Rs. 20,000.

(C) Rs. 2,000.

(D) Rs. 1,000.

View Answer
(A) Rs. 5,000.

Question 17. A Perk is ______________.

(A) Cash paid by employer to employee

(B) Amount credited to employees.

(C) Facility provided by employer to employee

(D) None of these accounts.

View Answer
(C) Facility provided by employer to employee

Question 18. Perquisites to employees are covered in the I.T. Act 1961 under ______________.

(A) Sec. 36 c.

(B) Sec 28a.

(C)  Sec. 17b.

(D) Sec 2a.

View Answer
(C)  Sec. 17b.

Question 19. The value of Interest free concessional loans to employees is determined on the basis of lending rates of ______________ for the same purpose.

(A) State govt.

(B) Central govt.

(C) R.B.I.

(D) S.B.I.

View Answer
(D) S.B.I. 

Question 20. An employee is deemed as a 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. 50,000.

(B) Rs. 1,00,000.

(C) Rs. 2,00,000.

(D) Rs. 5,00,000.

View Answer
(A) Rs. 50,000. /su_spoiler]

Question 21. Value of rent free accommodation in case of Govt. employee shall be taxable up to ______________.

(A) 10% of employees salary.

(B) License fee fixed by Govt.

(C)  7.5% of employees salary.

(D) 15% of employees salary.

View Answer
(B) License fee fixed by Govt.

Question 22. Value of rent free accommodation a house owned by employer in case of non- Govt. employees with above 25 lakhs population is ______________.

(A) 20% of employees salary

(B) 7.5% of employee salary

(C) 15% of employees salary

(D) 10% of employees salary

View Answer
(C) 15% of employees salary

Question 23. Interest on RPF balance is exempted up to ______________.

(A) 12%.

(B) 10%.

(C) 9.5%.

(D) 9.75%.

View Answer
(C) 9.5%.  

Question 24. Employers contribution to RPF is exempted up to ______________.

(A) 11% of salary.

(B) 12% of salary.

(C) 13% of salary.

(D) 10% of salary.

View Answer
(B) 12% of salary.

Question 25. Commuted value of pension is fully exempted in case of ______________.

(A) an employee of the private sector.

(B) a Govt. employee.

(C) an employee of a public sector undertaking.

(D) none of these.

View Answer
(B) a Govt. employee.
Quiz 1 2 3 4 5 6 7 8