MCQ ON Income Tax Law and Accounts(UNIT 1)
B.COM SEM 6
UNIVERSITY OF LUCKNOW
Q1. Parliament has the power to levy tax on incomes other than .
- Exempt Incomes
- Income of poor people
- Agricultural Income
- All incomes aretaxable
Q2. A person includes .
- Individual & HUF
- Firm & Company
- AOP/BOI, LA, Every AJP
- All of the above.
Q3. Association of persons consists of .
- Individuals (only)
- Company
- Any Person other than (a)
- Any kind of person
Q4. Explanation gives to the main provision.
- Clarification
- Exceptions
- Proper Administration
- None of these
Q5. ………….of Income Tax Act is related to residential status.
- Section 2
- Section 6
- Section 5
- Section 4
Q6. . Resident of India includes
- Ordinarily resident
- Not ordinarily
- NRI resident
- Both (a) and (b)
Q7. The Company may have the residential status as
- Resident or Non-resident
- Not ordinarily resident
- Non-resident
- Resident
Q10. The agricultural income includes
- Income from sale of crop
- Income from preparation of crop
- Income from nursery
- All of the above
Q11. If the agricultural income———————- is considered for calculating tax then the agricultural
- More than 5,000 and total income is exceeding exemption
- More than 5,000
- More than 10,000
- Any amount
Q12. Which section of the Income Tax Act exempted incomes have been mentioned?
- Section 80C
- Section 80DD
- Section 10
- Section 2
Q13. . The meaning of exempted income is
- Not included in total income
- Agricultural income
C. Not taxable limit under income tax
D . All of the above
Q14. ‘Income’ includes the following types .
Legal
Illegal
Both (A) & (B)
None
Q15.A domestic company means .
- Indian company only
- Both Indian company & foreign company
- Both Indian company & a foreign company having business connection in India
- Both Indian company & a foreign company which has made the prescribed arrangement for declaration &payment of dividends in India out of the income chargeable to tax in India.
14…………….is the casual income.
- (a)interest received
- (b) Dividend income
- (c) Pension received
- (d) Winning from lotteries
15. The way of tax liability by taking full advantage provided by the Act is
- Tax management
- Tax avoidance
- Tax planning
- Tax evasion
16. Total income of a person is determined on basis of his
- Residential status
- Citizenship in India
- Both (a) & (b)
- None of the above
17. Residential status of company is determined
- u/s 6(4)
- u/s 6(1)
- u/s 6(6)
- u/s 6(3)
18. Indian Income means,
- Income accrued. Deemed to be accrued in India
- Income received. Deemed to be received in India
- Both (a) & (b)
- None of the above.
19. Income received in India during the previous year is taxable in the case of
- ROR
- RNOR
- NR
- All
20. Is tax planning legal or illegal Legal:
- legal and ethical/ moral
- legal but not ethical
- illegal but ethical
- none of these
21. Tax planning bring reduction In tax liability of following:
- A company
- An Assessee
- A H.U.F
- Individual
22. An art of dodging tax without actually breaking the law
- tax planning –
- Tax Avoidance
- Tax evasion
- Tax management
23. When a person reduce his total income by making false claim it is a procedure of:
- tax planning
- Tax Avoidance
- Tax evasion
- Tax management
24. An individual may get income
A. In India
B) Outside of India
C. In India as well as outside India
D. No any where
25. Agriculture income is :
a. Taxable
b. Exempted
c. partly Exempt
d. None
26. Tax free income from
A. agricultural income
B. Foreign allowances
C. dividend from Indian company
D. all of these
27. Any sum received by an Individual as a member of HUF from the income of HUF shall be the following :
(a) Fully taxable
(b) Fully exempt u/s 10(2)
(c)X, Fully taxable u/h “Salary”
(d) Taxable @ 15%.
28. Share of the profits from the firm by the partner is:
(a) Fully taxable
(b) Fully Exempt u/s 10(2A)
(c) Fully taxable u/h “Salary”
(d) Exempt upto Rs. 2.5 lacs
29. Tax paid by the employer on non-monetary perquisites provided to the employee is exempt u/s
(a) 17(2)
(b) 10(14)
(c) 10(10CC)
(d) None
30. Daily Allowance & Constituency Allowance received by a Member of Parliament & MLAs is purpose
(a) Exempt
(b) Taxable
c) Included in total income for rate
(d) Spent amount is Exempt
31. Scholarship received by a student is:
(a) Casual income
(b) Fully exempt u/s 10(16)
(c) Fully taxable
(d) Exempt if AO deems fit
32. Family pension received by legal heir of army personnel who died during operational duties is
(a) Exempt u/s 10(18)
(b) Exempt u/s 10(19)
(c) Exempt u/s 10(20)
(d) None of the above
33. Which of the following income is agricultural income?
(a) Rent received from agricultural land
(b) Income from dairy farm
c) Income from poultry farm
(d) Dividend from a company engaged in agriculture
Q34. Assessment Year is the period of 12 month
commencing on 1st day of .
(a) April every year
(b) December every year
(c) July every year
(d) January every year
Q35. Previous Year can be a period of .
(a) > 12 months or < 12 months
(b) only 12 months
(c) 12 months or < 12 months
(d) ≥ 12 months.
Q36. When Income Tax was levied in India first time?
(A)in 1860
(B)In 1866
(C)in 1918
(D)In 1961
37. Income-tax is:
(A)a direct tax
(B)an indirect Tax
(C)business tax
(D)none of these
38. Rate of income-tax is fixed under:
(A)The Income Tax Act
(B)The Finance Act
(C)An Ordinance
(D)none of these
Q39. How Many heads of income tax are there to compute Gross total income of an assesse?
- Three
- Four
- Five
- six
Q39. The present Income Tax Act is known as:
- Income Tax Act, 1922
- Income Tax Act, 1886
- Income Tax Rule, 1962
- Income Tax Act, 1961
Q40. The period of 12 months commencing on the 1st day of April every year is known as:
- (A)The Previous Year
- (B)The Assessment Year
- (C)The Accounting Year
- (D)The Financial Year
Q41. The definition of income is:
- (A)inclusive
- (B)exhaustive
- (C)complex
- (D)simple
Q42. Income Tax Act was passed in:
- (A)1961
- (B)1971
- (C)1981
- (D)1951
Q43.The term previous year means:
(A)The Financial year
(B)Calendar year
(C)Accounting year
(D)The Financial year before the assessment year
Q44.Income Tax is computed on:
(A)Capital
(B)Fixed Assets
(C)Income
(D)Business Gains
44. Income tax is collected on all types of income except
(a) Agricultural Income
(b) Industrial Income
(c) Capital Gain
(d) Household Property
45. The Income Tax Act came into force from
(a) 1st March 1971
(b) 1st April 1971
(c) 1st March 1961
(d) 1st April 1961
46. The first income tax act was introduced in the year
- 1861
- 1918
- 1860
- 1886
47. Income tax is…
A. A direct tax
B. An indirect Tax
C. Business Tax
D. none of these
48. Income Tax Act was passed in the year
a. 1947
b. 1950
C . 1961
d. 1991
49.Which Entry of Union List gives the power to Parliament to levy tax on incomes?
(a) Entry 81 of List I to Seventh schedule
(b) Entry 81 of List Il to Seventh schedule
(c) Entry 82 of List I to Seventh schedule
(d) Entry 82 of List Il to Seventh schedule
50.As per the definition of Income, the income includes the following
(a) Profits and gains
(b) Dividend declared
(c) Voluntary contribution received by a trust created
(d) All of the above
51.The period of 12 months commencing on the first day of April every year and ending on 31 March is called as
(a) Previous Year
(b) Assessment year
(c) Accounting Year
(d) Financial Year
52. 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
53. As per Section 2(7), “Assesses” means a person……
(a) By whom any tax or other sum of money is payable
(b) Against whom proceeding has been taken under the act
(c) A person deemed to be assessee in default
(d) All of the above
54. A person includes
(a) Individual & HUF
(b) Firm & Company
(c) AOP/BOI, LA,
(d) All of the above.
55. The term “Person” includes.
(a) Registered Firm
(b) Unregistered
(C)Both of (a) & (b)
(d) None of (a) or (b)
56. Association of persons consists of
(a) Individuals (only)
(b) Company
(c) Any Person other than
(d) Any kind of person
57. Body of Individuals consists of.
(a) Individuals only
(B)Company
(c) Any Person other than (a)
d) Any kind of person
58. As per Section 2(31), the following is not included in the definition person’.
(a) Individual
(b) HUF
(c) Company
(d) Minor
59.House rent allowance is:
(A) Fully exempted
(B) Exempted to a certain limit
(C) Exempted in big cities
(D) Exempted for Govt. Employees
60.The HRA paid to an employee residing in Agra is exempt up to the lower of actual HRA, excess of rent paid over 10% of salary or:
(A)40% of salary
(B)50% of salary
(C)60% of salary whichever is less.
(D)75% of salary
61.The Commuted pension, in case the employee, does not get gratuity, shall be taxable:
(A)1/3 of total pension
(B) 2/3 of total pension
(C) 1/4 of total pension
(D) 1/2 of total pension
62.In the case of non-government employees covered by the Payment of Gratuity Act, 1972, what is the maximum amount of gratuity exempt from tax?
(A)10,00,000
(B)2,50,000
(C)20,00,000
(D)5,00,000
63.Gratuity received by a Government employee is:
(A)Fully exempted
(B)Partly taxable
(C) Fully taxable
(D) Exempted up to 10,00,000
64.The periodic payment of money for the past service is known as:
(A)Pension
(B)Commuted Pension
(C) Gratuity
(D) None of these
65.Maximum exempted amount of encashment of earned leave received by an employee is:
(A) 2,00,000
(B) 1,35,360
(C)2,40,000
(D)3,00,000
66.Maximum amount of exemption in case of compensation on retrenchment is:
(A)3,00,000
(B)4,00,000
(C)5,00,000
(D)6,00,000
67.Maximum amount of exemption in case of compensation on voluntary retirement is:
(A)4,00,000
(B)5,00,000
(C)8,00,000
(D)10,00,000
68.Amount received from a recognised provident fund at the time of retirement is exempt:
(A)3,00,000
(B)5,00,000
(C) 10,00,000
(D) Whole amount
69. Health & Education Cess is liveable on
(a) Income tax
(b) Income tax + SC (if any)
(c) Only Surcharge
(d) Not applicable at all
70. The rate of HEC for AY 2019-2020 is
(a) 2%
(b) 3%
(c) 3%
(d) 4%
71. Surcharge on income tax is payable by
(a) Company
(b) Individual
(c) Firm
(d) All assesses
72. The apex body of Income Tax Department, is
a. Finance Ministry of Central Govt.
b. Central Govt. of India.
C) CBDT.
D)Department of Revenue
73. The term of previous year means
a) The financial year
B. calendar year
C. The financial year before the assessment year
D. accounting year
74.. How many heads of income are there in compute gross total income of an assessee:
A. Three Four
B.Four Year
C. Five
6. Six
75. Sum of various heads of income is called:
A. Gross total income
B. Total income
c. taxable income
d. aggregate income