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Profit on shares(136000*75/100) = 102000
Less: Capital losses = 15000
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2005 and ending on 31st December 2005. What will be its tax year?
Tax year 2003
Tax year 2004
Tax year 2005
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^ 623 Online Quiz
Solved By vuZs Solution ¦e
Which of the following is not the type of tax?

£elect correct option:
Direct taxes
Indirect Taxes
Value Added Taxes
êes nd Pen lties
Ref:
¦ype of ¦ es:
Different types of taxes are explained below:
Direct taxes
Indirect Taxes
Proportional Taxes
Progressive
Regressive taxes
Value Added Taxes.
£pecial tax year is adopted after seeking approval from the ____________ under section 74(3).
Coissione
Tax Officer
Appellate Tribunal
£upreme Court
Ref:
Speci l ¦ Ye :
In case a person has a different accounting period from normal tax year or adopted such a period
after seeking approval from commissioner under section 74(3) it is called special tax year.
Which of the following is tax, where the tax rate decreases as the amount to which the rate is
applied increases?
Proportional tax
Pogessive t
Regressive tax
Corporate tax
Ref:
Pogessive ¦ es
This is based on the ³capacity to pay´ principle of taxation. In this type, the rate of tax increase
as
the income increase.
__________ are allowable deductions in case if the tax payer is running a business.
£alaries paid
Purchases
Office expenditures
Gll of the given options
Which of the following is an example of Lump sum receipt?
Pension
Golden shake hand
Provident fund
Which of the following is the main tool of Fiscal Policy?
Taxes
Deficit Financing
£ubsidies
Transfer Payments
Ref:
nstuents of îsc l Policy
¾ Government Expenditures
¾ Taxes
¾ Deficit Financing
¾ £ubsidies
¾ Transfer Payments²like Unemployment Allowances etc.
Which of the following is the £pecial Accounting Year of Companies exporting rice?
jst J nu y to 3jst Decee
1st July to 30th June
1st October to 30th £eptember
1st £eptember to 31st August
Ref:
All persons exporting rice and carrying insurance business 1st
January to 31st December
A firm ABC maintaining its account in accrual basis, at June 27, 2008 it is entitled to receive Rs.
10,000 but actual payments made at 01 August 2008. In which year it is charged to tax?
2006
2007
2008
2009
Which of the following tax is payable on merchandise imported or exported from one country to
another?
Custom duty
Income tax
S les t
Wealth tax
Which one of the following is the general definition of tax?
Compulsory contribution of wealth by persons
Optional contribution of wealth by persons
Copulsoy contiution of we lth y st te
Optional contribution of wealth by state
Ref:
General Definition of Tax:
General compulsory contributions of wealth levied upon persons by the state, to meet the
expensesincurred in providing common benefits upon the residents.
In a tax _____ you give information about what you earn every year.
Return
£tatement
£heet
Report
Gnswe equied
_____ tax is paid from money you have received from someone who has died.
Income
nheit nce
Property
£ales
Achieving full employment level is one of the objectives of which of the following policy?
Monetary policy
îsc l policy
Trade Policy
Economic Policy

` D¦R` G` G¦ O
Sping 2009
^ 623- ¦ tion ` n geent (Session - 2)
Solved By vuZs ¦e
vuzshelp@g il.co

Question No: 1 ( Marks: 1 ) - Please choose one
Taxes are important instrument of which one of the following policy?
Monetary policy
îsc l policy
Trade Policy
Economic Policy
Removal of deficit in Balance of Payments is one of the objectives of which of the
following policy?
Monetary policy
îsc l policy
Trade Policy
Economic Policy
Ref:
Oectives of îsc l Policy
Removal of deficit in Balance of Payments

In the canons of taxation, which one of the following statements best describe the
benefits principle?
Pesons deiving oe incoe le ds to enoy less enefits fo the st te,
should e t ed t the lowe tes.
Persons deriving more income leads to enjoy less benefits from the state,
should be taxed at the higher rates.
Persons deriving less income leads to enjoy more benefits from the state,
should be taxed at the lower rates.
All persons deriving more or less income should be taxed at the same rates.
Ref:
Benefit pinciple
This principle suggests that taxes should be levied according to the benefits derived by the
person from the state. £ince more benefits are derived by lower income groups, hence according
to this principle, those who derive more income but enjoy less benefits from the state should be
taxed at the lower rates and those persons who derives less income but more benefits from £tate
should be taxed at high rates.
Taxation management is a strategy where by a person manages its business in
such a way so as to maximize the utilization of which of the following?
Tax holidays
Exemption, Rebates & Concession
Tax credits
Ref:
¦ tion ` n geent²pl ined

Taxation management is a strategy where by a person manages its business and other
transactions/activities in such a way so as to make maximum use of tax holidays, exemption,
concession, rebates, tax credits, deductible allowances available under law and as a result is able
to derive the benefit of minimizing his tax liability.
î

Pakistan?
jst July, j979
1st July, 1969
1st July, 1949
1st July, 2002
Ref:
ncoe ¦ Odin nce, j979
First law on Income Tax was promulgated in Pakistan from 1st
July, 1979.
How many £ections are included in the Income Tax Ordinance 2001?
340 sections
440 sections
140 sections
240 sections
Ref:
B sic ê tues of ncoe ¦ Odin nce 200j
£cheme of the Ordinance is given below:
¾ There are thirteen chapters

¾Chapters are divided into:
ƒParts &
ƒDivisions
¾There are 240 £ections
fo oe contents visit
http://goups.google.co/goup/vuZs
£uperior judiciary includes which of the following authorities?
City Court
£upreme Court
High Court
Both supee nd High cout
The _____ year is a period of twelve months arbitrarily chosen for tax purposes.
Economic
îsc l
Economy
Monetary
Which of the following is the £pecial Accounting Year of Insurance Companies?
jst J nu y to 3jst Decee

Ref: All persons exporting rice and carrying insurance business 1st January to 31st December.
Which of the following is the £pecial Accounting year of the persons carrying cotton
ginning, rice husking and oil milling?
1st January to 31st December
jst Septee to 3jst Gugust
Ref: All persons carrying on business of cotton ginning, rice husking and oil milling1st
£eptember to 31st August.
Which one of the following is the example of tax payer?
£alaried Person
LE£CO
WAPDA
Which of the following is the legal status of the Virtual University under the
provisions of section 80 of the ordinance?
Individual
Cop ny
Banking Company
Hindu Undivided Family
Ref:
P ge no j6
For the purpose of Taxation the total Income includes which of the following?
ncoe s pe Section jj
Income from Capital gain
Only business income
Only £alary income
Ref: HGDS O^ CO` (Section jj)
Following are the heads of income, ascertained in section 11
£alary (£ection 12)
Income from Property (£ection 15)
Income from Business (£ection 18)
Capital Gains (£ection 37)
Income from other £ources (£ection 39)
Which of the following section deals with the change of accounting method
adopted by an entity?
£ection 32(1)
£ection 32(2)
£ection 32(3)
Section 32(4)
Ref: èthod of ccounting (Section 32)
ƒ Cash Basis or
ƒ Accrual Basis
For Companies µAccrual Basis¶ method of accounting is compulsory [£ection 32(2)]
Change of Method of Accounting can be made under [£ection 32(4)]
What will be the tax treatment of any income chargeable under the head £alary
earned by an individual outside Pakistan during that year?
Wholly Taxable
Wholly ept
Partly Exempt
Not mention in Ordinance
Ref:
2.Where a citizen of Pakistan leaves Pakistan during a tax year and remains abroad during that
tax year, any income chargeable under the head :£alary´ earned by him outside Pakistan during
that year shall be exempt from tax under the Ordinance
Date for the exemption limit for Foreign Currency Account (FCA) under Clause
80 of the Part I of £econd £chedule is available to which of the following?
j6 Decee j999
16 November 1999
16 July 2001
1st
July 2002
Ref:
Foreign Currency Accounts [Clause (80), Part I of the £econd £chedule]
³Any income derived from a private foreign currency account held with an authorized bank in
Pakistan, [or certificates of investment issued by Investment Banks,] in accordance with the
Foreign Currency Accounts £cheme introduced by the £tate Bank of Pakistan, by a resident
individual who is a citizen of Pakistan. Provided that the exemption under this clause shall not be
available in respect of any incremental deposits made in the said accounts on the after the j6th
d y of Decee, j999, or in respect of any accounts opened under the said scheme on or after
the said date.´
£enior citizen-age 60 years & above where taxable income not exceeding
________ tax liability reduced by 50% under Part 3 of second schedule.
Rs. 500,000
Rs. 200,000
Rs. 300,000
Rs. 400,000
Ref: Reduction in ¦ Li ility unde Second Schedule P t 3
Any amount received as flying allowance by pilots etc. and junior commissioned officers or
other ranks shall be taxed @2.5% as separate block.
£enior citizen-age 60 years &above where taxable income not exceeding Rs. 500,000/- tax
liability reduced by 50%.
M/s ABC & Co. has been incorporated under Pakistan Companies Ordinance 1984.
However it¶s most of the branched and control and management of affairs wholly
situated out of Pakistan? What will be the residential status of M/s ABC & Co.?
Resident Company
on-Resident Cop ny
Resident Individual
Resident AOP
£alary income received by resident person from Federal Government of Pakistan
in UK belongs to which of the following?
P ist ni souce of ncoe
Foreign source of income
Both Pakistan and foreign source of income
None of the given option
Rental income shall be Pakistan-source income if it is derived from:
¦he le se of iov le Popety in P ist n
The lease of immovable Property outside Pakistan
The lease of immovable Property both in and out of Pakistan
None of the given options
Ref:
9) Rental income shall be Pakistan-source income if it is derived from the lease of immovable
property in Pakistan whether improved or not, or from any other interest in or over immovable
property, including a right to explore for, or exploit, natural resources in Pakistan.

Any gain arising on the disposal of shares in a non-resident company belongs to
which of the following?
Pakistan- source income
ôeign souce of incoe
Ref:
13)Any gain arising on the disposal of shares in a resident company shall be Pakistan- source
income.
Which of the following come under the ambit of Royalty under section 2 (54)?
Right to use any patent
Copy right of a literary
Right to use any industrial or scientific equipment
Ref:
Royalty Defined £ec. 2 (54)
Royalty means any amount paid or payable however described or computed, whether periodical
or lump sum as a consideration for:
a)The use of, or right to use any patent, invention, design or model, secret formula or process,
trade mark r other like property or right;
b) The use of, or right to use any copy right of a literary, artistic or scientific work, including
films or video
Tapes for use in connection with television or tapes in connection with radio broadcasting, but
shall not include consideration for the sale, distribution or exhibition of cinematograph films.
c)The receipt of, or right to receive, any visual images or sounds or both, transmitted by satellite,
cable, optic fiber or similar technology in connection with television, radio or internet
broadcastingw
What is the tax treatment of losses from the foreign source under section 104 of
the ordinance?
Wholly taxable
Partly Taxable
Deductile ependitue
Ref:
Foreign losses £ec.104: Deductible expenditures incurred by a person in deriving foreign-source

income chargeable to tax under a head of income shall be deductible only against that income.
Which of the following section of Income Tax Ordinance 2001 deals with Income
from £alary and its treatment?
£ection 11
Section j2
£ection 13
£ection 14
Ref:
ÒDUL 4
HEAD£ OF INCOME (£ection 11)

Following are the heads of income, ascertained in section 11
> S l y (Section j2)
Income from Property (£ection 15)
Income from Business (£ection 18)
Capital Gains (£ection 37)
Income from other £ources (£ection 39)
The definition of Employment under £ec. 2(22) of the ordinance is categorized in:
nclusive Definition
Exclusive Definition
Both Inclusive and Exclusive
Ref:
nclusive Definition:
Examples of inclusive definitions are given below:
It includes dictionary meanings as well as meanings conveyed by definition.
£alary by members of AOP is not treated as £alary but treated as appropriation of
profit and charged under the head:
Income from £alary
Income from Property
ncoe fo Business
Income from Other £ources

Ref:
£alary by members of AOP is not treated as £alary but treated as appropriation of profit and
charged under the head ³Income from Business´
Tax year for the salaried individuals is called as:
£pecial Tax Year
o l ¦ Ye
Fiscal Year
Financial Year
Ref:
Tax year of a salaried Person shall be Normal Tax year
Which of the following is the Tax year available for salaried individual?
1st January to 31st December
jst July to 30th June
Ref:
Tax on salary income for Tax year 2009 (1st July 2008 to 30th July 2009) shall be computed
according to amendments as made by Finance Act, 2008.
Mr. A non-resident of Pakistan received interest on Canadian Bonds Rs. 150,000

(entire amount received in Pakistan). What is the treatment of this amount for
calculating his gross total income?
Rs. j50,000 dded in his tot l incoe
Rs. 150,000 subtracted from his total income
Rs. 75,000 added in his total income
Exempt from tax
Mr. X employed in Pakistan earned pension from Pakistan Government but
received in London Rs. 100,000. Which one of the following option is right for
this particular scenario?
`. eing esident of P ist n Rs. j00,000 will e dded in Goss tot l
incoe
Mr. X being resident of Pakistan Rs. 100,000 will be subtracted in Gross
total income
Mr. X being non-resident of Pakistan Rs. 100,000 will be added in Gross
total income
Mr. X being non-resident of Pakistan Rs. 100,000 will be exempted
Question No: 31 ( Marks: 5 )
Define Income that is charged to tax under section 2(9).
Gnswe:
Business Defined Section 2(9)
³Business includes any trade, commerce, manufacture, profession, vocation but doesn¶t include
employment´
Following incomes (except exempt income) shall be charged to tax under the head µIncome from
Business¶.
a)Profits & Gains from any business in a tax year.
b)Income derived from any trade, profession, sale of goods or provision of any services.
c)Income from hire or lease of tangible movable property.
d)FMV of Perquisites derived by a person by virtue of business relationships.
e)Management Fee derived by a management company.
Income from Business also includes:
Any profit on debt derived by a person. (it is only applicable to such person, whose is business
is to
derive such income. e.g.; a banking company)
Any amount received by schedule bank from mutual fund, as share of profit.
Profit earned on debts in course business shall be chargeable to µincome from business¶.
Income on leasing by lessor, being banks, leasing companies etc.
Income derived from any trade, profession, sale of goods or provision of any services.
Income from hire or lease of tangible movable property
FMV of Perquisites derived by a person by virtue of business relationships.
Management Fee derived by a management company
Determine the legal status of the following persons under section 80 of the
ordinance.
1. Virtual University of Pakistan (company)
2. A joint family of Mr. Arun (a Hindu), Comprising Mr. Hamel, His sons
Mr. Kumar & Mr. Deepak (Hindu undivided family)

3 . Government of Punjab, Pakistan (company)
4. Edhi Welfare Trust (company)
5. Federal Government (person)
6 . Mr. £uleman & his wife Joint Owners in a House (Association of persons)
7. Alpha Cooperative Housing £ociety (company)
8. Mr. Ali & Babar Joint Owners in Building (Association of persons)
9. Mr. Imran £erving as a Manager in a Textiles Company (Individual)
10. Habib Modaraba (company)
!"#$%$&'!('#!)(
£ *++,
^!(-*./#
0

1£ /*2
£ 3 #

4

Which of the following is the general definition of tax?
Copulsoy contiution of we lth y pesons
Optional contribution of wealth by persons
Compulsory contribution of wealth by state
Optional contribution of wealth by state
Ref:
General Definition of Tax:
General compulsory contributions of wealth levied upon persons by the state, to meet the
expenses incurred in providing common benefits upon the residents.
Which of the following is the main objective of Fiscal Policy?
Economic Development
Price stability
Ref:
Oectives of îsc l Policy
Raising level of employment (Achieving full employment level
Influencing consumption patterns
Price stability
Redistribution of income
Government Expenditure is one of the instruments of which of the following
policy?
Monetary policy
îsc l policy
Trade Policy
Economic Policy
Ref:
nstuents of îsc l Policy
Government Expenditures
Taxes
Deficit Financing
£ubsidies
Transfer Payments²like Unemployment Allowances etc.
Taxation management is a strategy where by a person manages its business in
such a way so as to maximize the utilization of which of the following?
Tax holidays
Exemption, Rebates & Concession
Tax credits
Which of the following was the First law on Income Tax promulgated in
Pakistan?
jst July, j979
1st July, 1969
1st July, 1949
1st July, 2002
Ref:
First law on Income Tax was promulgated in Pakistan from 1st
July, 1979.
£uperior judiciary includes which of the following authorities?
City Court
£upreme Court
High Court
Both supee nd High cout
£ection 2(15) of Income Tax Ordinance 2001 defined:
³debt´ means any amount owing, including accounts payable and the amounts
owing under promissory notes, bills of exchange, debentures, securities, bonds or
other financial instruments;
In which criteria the above definition falls?
clusive definition
Inclusive definition
Both Exclusive and Inclusive definitions
£tatutory definition
Ref:
clusive o h ustive Definition:
It excludes ordinary dictionary meanings of the word. Exclusive definitions start with
the expressionµmean¶ or µmeans¶.
³association of persons´ means an association of persons as defined in section 80.
clusive definition
Both Exclusive and Inclusive definitions
Ref:
clusive o h ustive Definition:
It excludes ordinary dictionary meanings of the word. Exclusive definitions start with
the expressionµmean¶ or µmeans¶.
Under which of the following conditions a tax payer can adopt a special tax year?
Whenever he decides so
After seeking approval from Tax Office
Gfte seeing ppov l fo Coissione of incoe t
After seeking approval from High Court
Ref:
A tax payer can adopt a special Tax year after seeking approval from Commissioner of Income
Tax (CIT)
Which one of the following is the example of tax payer?
£alaried Person
LE£CO
WAPDA
Which of the following is the legal status of the Virtual University under the
provisions of section 80 of the ordinance?
Individual
Cop ny
Banking Company
Ref:
Page no 16
In case of lump sum receipt of income like Golden hand shake the tax payer pays
tax in which of the following way?
Average of last 3 years tax rate
Option to choose cuent o ve ge of l st 3 ye s t te
Current tax rate
Previous year tax rate
$
@

Certain incomes those are excluded from tax are called as:
Perquisites
eptions
Allowances
Deductions
Which of the following incomes are treated as agriculture income?
£pontaneous forests
Agro based industry
Interest received by a farmer on lending
ncoe fo l nd in P ist n used fo gicultue

What is the tax treatment of the salary of an employee of foreign government but
citizen of Pakistan?
Exempt form tax
Wholly ¦ le
Partly Taxable
No Tax treatment given in IT Ordinance 2001
Ref:
Section 43 ôeign Govenent Offici ls
£alary of an employee of foreign government exempt provided:
a.Employee citizen of foreign country and not a citizen of Pakistan.
b.£ervices performed are similar to services performed by employees of the Federal Government
in foreign countries and
c.Foreign government also grants similar exemptions to employees of Federal Government.

httgr s.g gle.c mgr s
Income of Federal Government exempt from tax under which of the following
section of IT Ordinance 2001?
£ection 41
£ection 43
£ection 47
Section 49
Ref:
Section 49 êde l & Povinci l Govt. nd Loc l Guthoity ncoe
Income of Federal Government exempt from tax
An Individual will be termed as £hort Term Resident under section 50 of the IT
Ordinance 2001 on which of the following condition?
His period of stay in Pakistan equal to 183 days
The employee of Foreign Government
The citizen of Pakistan
His peiod of st y in P ist n not eceeding 3 ye s
Ref:
Section 50 ôeign-Souce ncoe of Shot-¦e Resident ndividu ls
1.£ubject to sub-section-2, the foreign-source income of an individual shall be exempt:
a.Who is a resident individual solely by reason of the individual¶s employment; and
b.Who is present in Pakistan for a period or periods not exceeding three years,
Resident Company
on-Resident Cop ny
Resident Individual
Resident AOP
Mr. Imran is an employee of Provincial Government of Punjab posted in UK for two
years? What will be the residential status of Mr. Imran?
Resident ndividu l
Non-Resident Individual
Resident HUF
Resident AOP
Which of the following days shall be counted as whole day for the computation of
residential status of an individual?
A public holiday
A day of sick leave
Any strike day
Ref:
ôllowing d ys sh ll e counted s whole d y:
A Public Holiday
A day of leave including sick leave
A day that individual¶s activity is stopped because of strike etc
A holiday spent in Pakistan
Which part of income is charged to tax of resident person under the income tax
ordinance 2001?
Pakistani source of income
Both P ist n nd foeign souce of incoe
Which of the following does Not come under the ambit of permanent
establishment (PE)?
Branch office
Factory or workshop
Premises for soliciting orders
Li ison o el tionship office
Ref:
a)A place of management, branch office, factory or workshop, premises for soliciting orders,
warehouse, permanent sales exhibitions or sales outlet, other than a liaison office except where
the office engages in the negotiation of contracts (other than contracts of purchase);
Mr. Ali resident of Pakistan received salary form UK? What will be the tax
treatment of his salary in Pakistan?
Wholly taxable
Partly Taxable
Wholly exempt
Wholly eept only if esident p id foeign t on his s l y
The salary received from the UK Government by Mr. Amir resident of Pakistan.
Which section of the income tax ordinance explains his tax treatment of such
salary?
£ection 110
£ection 101
Section j02
£ection 50
Ref:
Foreign £ource £alary of Resident Individuals £ec. 102
(1) Any foreign-source salary received by a resident individual shall be exempt from tax if the
individual
has paid foreign income tax in respect of the salary.

Which of the following section of Income Tax Ordinance 2001 deals with Income
from £alary and its treatment?
£ection 11
Section j2
£ection 13
£ection 14

Mr. A resident of Pakistan received interest on Australian Bonds Rs. 100,000
(half amount received in Pakistan). What is the treatment of this amount for
calculating his gross total income?
Rs. j00,000 dded in his tot l incoe
Exempt from tax
Mr. X non-resident of Pakistan earned income from property situated in Dubai
Rs. 70,000 but received in Pakistan. Which one of the following option is right
for this particlar scenario?
`. eing non-esident of P ist n Rs. 70,000 will e dded in Goss
tot l incoe
Mr. X being non-resident of Pakistan Rs. 70,000 will be subtracted in
Gross total income
Mr. X being non-resident of Pakistan Rs. 70,000 will be claimed as
admissible deduction
Mr. X being non-resident of Pakistan Rs. 70,000 will be exempted
Mr. X employed in Pakistan received share of profit Rs. 60,000 in India from a
business situated in Dubai but controlled through PE in Pakistan. Which of the
following is right for the above scenario?
`. eing esident of P ist n Rs. 60,000 will e dded in Goss tot l
incoe \
Mr. X being resident of Pakistan Rs. 60,000 will be subtracted in Gross
total income
total income
Mr. X being non-resident of Pakistan Rs. 60,000 will be subtracted in
Gross total income
Mr. X employed in Pakistan remittance from U£A received Rs. 10,000 in
Pakistan from past profits. Which of the following is right for the above scenario?
Mr. X being resident of Pakistan Rs. 10,000 will be added in Gross total
income
Mr. X being resident of Pakistan Rs. 10,000 will be £ubtracted in Gross
total income
total income
Reitt nce is not incoe hence it is not included
Mr. X resident of Pakistan remittance from UK received Rs. 20,000 in Pakistan
from past profits. Which of the following is right for the above scenario?
income
total income
total income
one of the given options

Why Government levy tax on Person? What are the important elements that take
into consideration while levying tax?
Gnswe:
Taxes Vs Fees:
Taxes are compulsory levy and it is the legal obligation of the person to pay the amount of tax
which is required to pay under the law, where as payment of fee is the discretion of any person
and when a fee is paid, the person becomes an entitled to claim counter benefits.
Taxes are important instrument of Fiscal Policy.
Determine Gross total income of Mr. Imran in the light of following particulars
information pertaining to tax year 2008.
a. Dividends received in UK on 20th Aug 2008 from a Pakistani resident
company: amounting Rs. 50,000.
b. Interest on £wiss Bonds (one-third is received in Pakistan) Rs. 60,000.
c. Pension from Pakistan Government but received in New York Rs. 25,000.
d. Rent for tax year 2008 of a house property situated in New York and
received there on 01-01-2008; Rs.500,000.
e. Income from agriculture in New York received there but later on remitted
to Pakistan Rs.80,000.
Find out gross total income of Mr. Imran, if he is:
a. Pakistani resident
b. Non± resident
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Sping 2009
Solved By vuZs Solution ¦e
vuzshelp@g il.co

Which of the following is opposite to the literal meanings of Tax?
Burden
£train
Load
Relieve
R^:
Literal meanings ----- Burden, £train
Which of the following is the main source of revenue generation of the state?
¦ es & ¦ iffs
Internal Borrowing
External Borrowing
Penalties & Fines

_____ is paid to the government on goods and services and can be reclaimed by
retailers.
Income Tax
V lue Gdded ¦
Capital Value Tax
Wealth Tax
Ref: y '!567
ale added tax is the tax that is nly refndable and aly f the g d and serices.
Which of the following is not an employment tax?
£ocial £ecurity Tax
êde l cise ¦
Federal unemployment compensation tax
£tate unemployment compensation tax
Ref: y '!567
for above mcqs is correct because after reading the definiation of federal excise tax you should
be able to differencete from the aboe. it the tax that government ampossed on the import of a
good and services thats why it has no connection with employment tax.
How many £chedules are contained in the Income Tax Ordinance 2001?
Three £chedule
Fifth £chedule
Seven Schedules
Nine £chedules
Ref:
Basic Features of Income Tax Ordinance 2001
£cheme of the Ordinance is given below:
There are thirteen chapters
Chapters are divided into:
ƒParts &
ƒDivisions
There are 240 £ections
This ordinance comprises of seven £chedules
£chedules are integral part of the Ordinance.


Under which of the following sections of Income Tax Ordinance 2001 vested the
powers to CBR in order to formulate the IT rule 2002?
£ection 206
£ection 213
Section 237
£ection 238
Ref:
IT rules 2002
These were promulgated by CBR on 1st July 2002 in exercise of powers granted under section
237 of theOrdinance.
Which one of the following is the Internal aid and help in the interpretation of
Punctu tion s
CBR¶s circulars
Definitions in other statutes
Departmental manuals
Ref:
Internal Aids:
These are available in the Act:
ƒ Explanation to the section
ƒ Marginal notes
ƒ Punctuation marks
ƒ Preamble
ƒ Title of a chapter
ƒ Non-Obstinate clause
ƒ Proviso
ƒ Context
³Commissioner´ means a person appointed as a Commissioner of Income Tax
yle="text-align: left; direction: ltr; margin: 0px;" dir="ltr">under section 208, and includes a
taxation officer vest ed with all or any of the
powers, and functions of the Commissioner;

Exclusive definition
Both clusive nd nclusive definitions
Ref:

Under which of the following conditions a tax payer can adopt a special tax year?
Whenever he decides so
After seeking approval from Tax Office
Gfte seeing ppov l fo Coissione of incoe t
After seeking approval from High Court
Ref:
£pecial Tax Year:
In case a person has a different accounting period from normal tax year or adopted such
aperiodafter seeking approval from commissioner under section 74(3) it is called special tax
year.
Mr. A & B Joint Owners of a Building, Which of the following is the legal status
under the provisions of £ection 80 of the Ordinance?
Company
Gssoci tion of Pesons
Ref:
³An association of persons´²includes a firm, a Hindu Undivided Family, any artificial
juridical personand anybody of persons formed under a foreign law, but doesn¶t include a
company.

Which of the following is the legal status of Mr. Z, a Director in Private Company
under section 80 of the Income tax ordinance 2001?
ndividu l
Company
Firm
Ref:
Person²£ec. 2(42) read with section 80. Person includes:
An individual
A company or association of persons incorporated or formed in Pakistan or elsewhere; and
The federal Government,
a foreign government,
a political sub division of foreign government, or
Public international organization
Which of the following is NOT an example of deemed income?
Golden hand shake
Loan through cross cheque
Gifts through proper transaction
Ref:
Deeed ncoe t P with e l incoe
Cash Basis Vs Accrual Basis
Illegal Income
Lump £um Receipts
Tax-free income
If the land situated in Pakistan and used for agriculture purposes then which of
the following factor make distinction between agriculture and non-Agriculture
Income?
Nationality of Pakistan
Quantity of the product
Time period
Hu n effot
£uppose a merchant acquired Profit from the purchase of standing crops and
resale of it after harvesting.
The profit of the merchant will be treated in which of the following way?
Agriculture Income
Income from Business
Capital Gain
Ref: nswe equied
ôllowing ncoes e held to e ³on-Ggicultu l ncoe´
Profit accruing from the purchase of standing crops and resale of it after harvest by a merchant
having no interest in land except a mere license to enter upon the land and gather upon the
produce, land is not direct, immediate or effective source of income
Mr. Ali being citizen of Pakistan of 60 years old, if his total taxable income is
Rs.400,000. His tax liability will be reduced by ______ under Part 3 of second
schedule.
10%
25%
50%
75%
Ref:
Reduction in ¦ Li ility unde Second Schedule P t 3
Any amount received as flying allowance by pilots etc. and junior commissioned officers or
other ranks shall be taxed @2.5% as separate block.
£enior citizen-age 60 years &above where taxable income not exceeding Rs. 400,000/- tax
liability reduced by 50%.

Resident Cop ny
Non-Resident Company
Resident Individual
Resident AOP
Which part of income is charged to tax of resident person under the income tax
ordinance 2001?
Pakistani source of income
Both P ist n nd foeign souce of incoe
Ref:
Scope of ¦ot l ncoe of Resident Peson Section jj (5)
Resident Peson Ch nge le to t on:
The income of a resident person under a head of income shall be computed by taking into
account amounts that are Pakistan-source income and amounts that are foreign-source income
Pakistan £ource Income & Foreign £ource Income £ec.11 (5) whereas, non-resident person
charged only on Pakistan £ource Income £ec.11 (6)
Which part of income is charged to tax of non-resident person under the income
tax ordinance 2001?
P ist ni souce of incoe
Ref:
whereas, non-resident person charged only on Pakistan £ource Income £ec.11 (6)
____________ means a fixed place of business through which the business of
an enterprise is wholly or partly carried on.
Pe nent est lishent
£mall Business Units £BU
Venture
Ref: y '!567
see section 2(41) at page no 9.
Which of the following come under the ambit of Royalty under section 2 (54)?
Right to use any patent
Copy right of a literary
Right to use any industrial or scientific equipment
Ref:
Roy lty Defined Sec. 2 (54)
Royalty means any amount paid or payable however described or computed, whether periodical
or lump sum, as a consideration for:
a)The use of, or right to use any patent, invention, design or model, secret formula or process,
trade mark
or other like property or right;
b)The use of, or right to use any copy right of a literary, artistic or scientific work, including
films or video
tapes for use in connection with television or tapes in connection with radio broadcasting, but
shall not
include consideration for the sale, distribution or exhibition of cinematograph films.
c)The receipt of, or right to receive, any visual images or sounds or both, transmitted by satellite,
cable,
optic fiber or similar technology in connection with television, radio or internet broadcasting;
d)The supply of any technical, industrial, commercial or scientific knowledge, experience or
skill;
e)The use of or right to use any industrial, commercial or scientific equipment;
f)The supply of any assistance that is ancillary and subsidiary to, and is furnished as a means of
enabling
the application or enjoyment of, any such property or right as mentioned in sub-clause (a)
through (e)
g)The disposal of any property or right referred to in (sub-clause) (a) through (e).

What is the relation between the Non-resident and permanent establishment
as per section 105?
Both have same legal entity
Both e sep te leg l entity
Both are dependent on each other
Ref:
The profit of the permanent establishment shall be computed on the basis that it is a distinct and
separate person engaged in the same or similar activities under the same or similar conditions
and dealing wholly independently with the non-resident person of which it is a permanent
establishment;
£alary by members of AOP is not treated as £alary but treated as appropriation of
profit and charged under the head:
Income from £alary
ncoe fo Business
Income from Other £ources
Ref:
£alary by members of AOP is not treated as £alary but treated as appropriation of profit and
charged under the head ³Income from Business´
In which of the following heads of Income No deductions are allowed:
S l y ncoe
Income from Business
Capital Gains
Ref:
No deductions are allowed under the head ³Income from £alary´
Mr Ali is an employee of ABC Co. the company has provided a driver and a
gardener to Mr. Ali. What will be the treatment of their salaries as per Income
Tax Ordinance 2001?
The salaried paid to them added in the salary of MR. Ali
The salaried paid to them subtracted in the salary of MR. Ali
H ve no el tion with s l y of `. Gli not sue
The £alaried paid are exempted from Tax
By '!567
A directorship or any other office involved in the management of a company
under section 2(22) of Income Tax Ordinance, 2001 is termed as:
ployent
Employer
Employee
Business premises
Ref:
2(22) ³eployent includes:
a directorship or any other office involved in the management of a company;
a position entitling the holder to a fixed or ascertainable remuneration; or
the holding or acting in any public office;

Mr. A non-resident of Pakistan received interest on Australian Bonds Rs.
100,000 (half amount received in Pakistan). What is the treatment of this
amount for calculating his gross total income?
Rs. 50,000 dded in his tot l incoe
Exempt from tax
Ref:
P ge no 35 eecise no 3
Mr. X employed in Pakistan remittance from U£A received Rs. 10,000 in
Pakistan from past profits. Which of the following is right for the above scenario?
income
total income
total income
Ref:
ote j:
Since eitt nce is not incoe, hence it is not included.
P ge 33 eecise not j
Mr. X resident of Pakistan remittance from UK received Rs. 20,000 in Pakistan
from past profits. Which of the following is right for the above scenario?
income
total income
total income
Mr. Kishan Kumar during his yearly tour in Pakistan spends 155 working days, 26
off-working days 1 strike day and 1 Public Holiday in a tax year 2008-09? What
will be the status of the individual?
Resident ndividu l
Non Resident Individual
Resident Person
Resident HUF
Ref:
155+26+1+1=j 3
Resident ndividu l (Section 2)
An individual shall be a resident individual for a tax year if the individual-
is present in Pakistan for a period of, or periods amounting in aggregate to, one hunded nd
eighty-thee d ys o oe in the t ye w o
Is an employee or official of the Federal Government or a Provincial Government posted
abroad in the tax year?
Mr. Zeeshan during his yearly tour in Pakistan spends 180 working days and in a
tax year 2008-09? What will be the status of individual?
Resident Individual
on-Resident ndividu l
Resident Person
Resident HUF
Ref:
Resident ndividu l (Section 2)
An individual shall be a resident individual for a tax year if the individual-
is present in Pakistan for a period of, or periods amounting in aggregate to, one hunded nd
eighty-thee d ys o oe in the t ye w o
Is an employee or official of the Federal Government or a Provincial Government posted
abroad in the tax year?


Why the right to acquire share is not chargeable to tax under Employee £hare
£cheme section 14. Under what condition the right to acquire share under section
14 is taxable?
Gnswe:
ployee Sh e Schees sec j4:
ƒThe value of a right or option to acquire share under this scheme shall be not chargeable to tax.
ƒWhere shares issued are subject to a restriction on transfer of the shares-
a)no amount shall be chargeable to tax under the head £alary until the earlier of-
i. the time the employee has a free right to transfer the shares; or
ii. the time the employee disposes of the shares &
b)the amount chargeable to tax to the employee shall be fair market value of shares at the time
employee has free right to transfer as reduced be any amount given as consideration for the grant
of a right or option to acquire the shares.
ƒWhere in a tax year an employee disposes of a right or option to acquire shares under an
employee
share scheme, the amount chargeable to tax shall include the amount of any gain made on the
disposal computed accordance with the following formula:
A-B
ƒWhere A is the consideration received from the disposal of the right or option.
ƒB is the employee¶s cost in respect of the right or option.
What is meant by Fiscal Policy?
Highlight the role of taxes in Fiscal Policy. Differentiate between Budget deficit
and Budget £urplus.
Gnswe:
What is Fiscal Policy?
Fiscal policy is a discipline that deals with arrangements which are adopted by government to
collect the revenue and make the expenditures so that social and economic stability could be
attained /
maintained.
Ü Oectives of îsc l Policy
Raising level of employment (Achieving full employment level)
Influencing consumption patterns
Price stability
Redistribution of income
Ü nstuents of îsc l Policy
Government Expenditures
Taxes
Deficit Financing
£ubsidies
Transfer Payments²like Unemployment Allowances etc.
Souces fo Revenue Gene tion fo St te
ƒ Taxes, Tariffs
ƒ Internal & External Borrowing
ƒ Penalties & Fines
ƒ Aids & Grants
` D¦R` G` G¦ O
Sping 20j0
¦ie: 60 in
` s: 44
Question o: j ( ` s: j ) - Ple se choose one
In the canons of taxation, which one of the following statements best describe the benefits principle?
Ź Pesons deiving oe incoe le ds to enoy less enefits fo the st te, should e t ed t the lowe
tes.
Ź Persons deriving more income leads to enjoy less benefits from the state, should be taxed at the higher rates.
Ź Persons deriving less income leads to enjoy more benefits from the state, should be taxed at the lower rates.
Ź All persons deriving more or less income should be taxed at the same rates.
Page 2
Question o: 2 ( ` s: j ) - Ple se choose one
Law making is the prime responsibility of which of the following authorities?
Ź P li ent
Ź £upreme Court
Ź High Court
Ź City Court
Which one of the following is the Internal aid and help in the interpretation of law?
Źc

Ź@(4
Źº

Źº

£ection 2(5A) of Income Tax Ordinance 2001 defined:
³assessment year´ means assessment year as defined in the repealed Ordinance.
Ź clusive definition
Ź Inclusive definition
Ź Both Exclusive and Inclusive definitions
Ź £tatutory definition
[


Page-8
A definition also includes the dictionary meanings of the word is termed as which of the following?
Ź Exclusive definition
Ź nclusive definition
Ź Both Exclusive definition and Inclusive definitions
Page-8
2(22) of Income Tax Ordinance 2001 defined:
³Employment´ includes:
â a directorship or any other office involved in the management of a company;
â a position entitling the holder to a fixed or ascertainable remuneration; or
â the holding or acting in any public office;
Ź Exclusive definition
Ź nclusive definition
Page-8
Question o: ( ` s: j ) - Ple se choose one
Ź Economic
Ź îsc l
Ź Economy
Ź Monetary
Which of the following is the legal status of the Punjab University under the provisions of section 80 of the
ordinance?
Ź Individual
Ź Cop ny
Ź Banking Company
Ź Hindu Undivided Family
Page-16
Question o: j0 ( ` s: j ) - Ple se choose one
Which of the following is the example of deemed income?
Ź Cash Gift
Ź Loan through cross cheque
Ź S l y
Ź Golden hand shake
Question o: jj ( ` s: j ) - Ple se choose one
Which of the following is O¦ an example of deemed income?
Ź·
1
Ź Gifts through proper transaction
Ź Golden hand shake

Ź Gll of the given options
Income Tax is charged on which of the following?
Ź ncoe of the cuent t ye
Ź Income of the previous year
Ź Income of the coming year
Ź Any Receipt of money
Which of the following is O¦ an example of Lump sum receipt?
Ź Pension
Ź Golden shake hand
Ź Provident fund
Ź S l y
Which of the following methods of accounting is compulsory to adopt for Firm?
Ź Accrual Basis
Ź Cash Basis
Ź Both Gccu l nd C sh B sis
Ź Free to choose any kind of base
The process of clubbing of income results in which of the following?
Ź Lower Bracket rate of tax is charged
Ź Highe B cet te of t is ch ged
Ź Moderate Bracket rate of tax is charged

Ź No change occur due to clubbing
Any salary received by an employee of a foreign government for services rendered to such government shall be
exempt from tax under which section of IT Ordinance 2001?
Ź £ection 40
Ź Section 43
Ź £ection 47
Ź £ection 53
Rate charged under presumptive tax regime to non resident shipping firm 8% on its gross receipt is quite low as
compare to other business. This is an example of which type of tax concession?
Ź Reduction in total taxable income
Ź None of the given options
Ź Reduction in tax liability
Ź Reduction in t te
Question o: j ( ` s: j ) - Ple se choose one
What is the tax treatment of any profit on the U£ Dollar Bonds purchased by the resident person after December
1999 under £econd £chedule?
Ź Wholly exempt
Ź Wholly taxable
Ź ¦ @j0% of pofit p id
Ź Not mention in second schedule
Which of the following section deals with the residential status of Company?
Ź Section j
Ź £ection 82
Ź £ection 83
Ź £ection 84
Which part of income is charged to tax of non-resident person under the income tax ordinance 2001?
Ź P ist ni souce of incoe
Ź Foreign source of income
Ź Both Pakistan and foreign source of income
Ź None of the given option
Question o: 2j ( ` s: j ) - Ple se choose one
£ale of goods through permanent establishment in Pakistan by a non-resident belongs to which of the following?
Ź P ist ni souce of ncoe
Rental income shall be Pakistan-source income if it is derived from:
Ź ¦he le se of iov le Popety in P ist n
Ź The lease of immovable Property outside Pakistan
Ź The lease of immovable Property both in and out of Pakistan
Page-29
Which of the following does ot come under the ambit of permanent establishment (PE)?
Ź Branch office
Ź Factory or workshop
Ź Premises for soliciting orders
Ź Li ison o el tionship office
P ge-29
Mr. Ali resident of Pakistan received salary form UK? What will be the tax treatment of his salary in Pakistan?
Ź Wholly taxable
Ź Partly Taxable
Ź Wholly exempt
Ź Wholly eept only if esident p id foeign t on his s l y
What is the relation between the Non-resident and permanent establishment as per section 105?
Ź Both have same legal entity
Ź Both e sep te leg l entity
Ź Both are dependent on each other
What is the tax treatment of losses from the foreign source under section 104 of the ordinance?
Ź Wholly taxable
Ź Partly Taxable
Ź Deductile ependitue
Page-31

Which of the following section of Income Tax Ordinance 2001 deals with Income from £alary and its treatment?
Ź £ection 11
Ź Section j2
Ź £ection 13
Ź £ection 14
Mr. A non-resident of Pakistan received interest on Canadian Bonds Rs. 150,000 (entire amount received in
Pakistan). What is the treatment of this amount for calculating his gross total income?
Ź Rs. j50,000 dded in his tot l incoe
Ź Rs. 150,000 subtracted from his total income
Ź Rs. 75,000 added in his total income
Ź Exempt from tax
Question o: 29 ( ` s: 3 )
What is meant by reduction in tax liability? Give an example from Income Tax ordinance 2001?
Define the employment as per its respective sections.
Question o: 3j ( ` s: 5 )
Define the following under the Income Tax Ordinance 2001 with their respective sections:
a. Resident Individual
b. Resident Associations of Persons
` (9

c
Î

Î

` D¦R` G` G¦ O
Sping 20j0
^ 623- ¦ tion ` n geent (Session - j)
¦ie: 60 in
` s: 47
A tax levied on the financial income of Persons, Corporations, or other legal entities is called as:
Ź Corporation tax
Ź Property tax
Ź £ales Tax
Ź ncoe ¦
V V
¦
Which of the following is the main objective of Fiscal Policy?
Ź Economic Development
Ź Price stability
Ź Removal of deficit in Balance of Payments
Ź Gll of the given options
Government Expenditure is one of the instruments of which of the following policy?
Ź Monetary policy
Ź îsc l policy
Ź Trade Policy
Ź Economic Policy
Page-2
In the canons of taxation, which one of the following statements best describe the benefits
principle?
Ź Pesons deiving oe incoe le ds to enoy less enefits fo the st te, should e t ed
t the lowe tes.
Ź Persons deriving more income leads to enjoy less benefits from the state, should be taxed at
the higher rates.
Ź Persons deriving less income leads to enjoy more benefits from the state, should be taxed at
the lower rates.
Ź All persons deriving more or less income should be taxed at the same rates.
Ref:
Benefit principle
This principle suggests that taxes should be levied according to the benefits derived by the
person from the state. £ince more benefits are derived by lower income groups, hence according
to this principle, those who derive more income but enjoy less benefits from the state should be
taxed at the lower rates and those persons who derives less income but more benefits from £tate
should be taxed at high rates.
Which of the following is not an employment tax?
Ź £ocial £ecurity Tax
Ź êde l cise ¦
Ź Federal unemployment compensation tax
Ź £tate unemployment compensation tax
How many £chedules are contained in the Income Tax Ordinance 2001?
Ź Three £chedule
Ź Fifth £chedule
Ź Seven Schedules
Ź Nine £chedules
$

! " #
$ %

$
³association of persons´ means an association of persons as defined in section 80.
Ź Economic
Ź îsc l
Ź Economy
Ź Monetary
Which of the following is the time period of a Normal tax year?
Ź 1st January and end on 31st December
Ź 1st June and ends on 31st May

Ź jst July nd ends on 30th June
Ź 1st October and ends on 30th £eptember
If the accounting year of a business engaged in cotton ginning is started from 01 £eptember 2003
and ending on 31st August 2004. What will be its tax year?
Ź Tax year 2002
Ź ¦ ye 2003
Ź Tax year 2004
Ź Tax year 2005
Income Tax is charged on which of the following?
Ź ncoe of the cuent t ye
Ź Income of the previous year
Ź Income of the coming year
Ź Any Receipt of money
Which part of Income Tax Ordinance 2001 deals with the Exemptions and Tax Concessions?
Ź P t V
Ź Part V
Ź Part VI
Ź Part VII
Which one of the following section deals with the Agriculture Income?
Ź £ection 40
Ź Section 4j
Ź £ection 43
Ź £ection 53
Ref:
.G
£
2#

Which of the following incomes are treated as agriculture income?
Ź £pontaneous forests
Ź Agro based industry
Ź Interest received by a farmer on lending
Ź ncoe fo l nd in P ist n used fo gicultue
Any salary received by an employee of a foreign government for services rendered to such
government shall be exempt from tax under which section of IT Ordinance 2001?
Ź £ection 40
Ź Section 43
Ź £ection 47
Ź £ection 53
Ref:
£

$
£

^
ü


G

£

!

Ź His period of stay in Pakistan equal to 183 days
Ź The employee of Foreign Government
Ź The citizen of Pakistan
Ź His peiod of st y in P ist n not eceeding 3 ye s
Ref:
£
!^
.£
£ .

£ 9 .

.'
.

$î

4
8
î

c

'
î

@

Ź Section j
Ź £ection 82
Ź £ection 83
Ź £ection 84
Ref:Resident Peson (Section j)

'
@
'
G
c

^*


^

.
Gc

Ź Control and management of affairs of AOP is situated partly in Pakistan
Ź Control and management of affairs of AOP is situated wholly in Pakistan
Ź Contol nd n geent of ff is of GOP is situ ted wholly o p tly in P ist n
Which part of income is charged to tax of resident person under the income tax ordinance 2001?
Ź Pakistani source of income
Ź Both P ist n nd foeign souce of incoe
Which part of income is charged to tax of non-resident person under the income tax ordinance
2001?
Ź P ist n souce of incoe
Ref: >c
£
=^
£
£ !# '

.

c
£
£ )#
D
Ô$ `$#.c

£alary income received by resident person from Federal Government of Pakistan in UK belongs
to which of the following?
Ź P ist ni souce of ncoe

____________ means a fixed place of business through which the business of an enterprise is
wholly or partly carried on.
Ź Franchise
Ź Pe nent est lishent
Ź £mall Business Units £BU
Ź Venture
Ref: c

'

'

.
D
Ô$7 `$#.c

Which of the following does Not come under the ambit of permanent establishment (PE)?
Ź Branch office
Ź Factory or workshop
Ź Premises for soliciting orders
Ź Li ison o el tionship office
Ref: #G

'
' '

' '

'

#
The salary received from the UK Government by Mr. Amir resident of Pakistan. Which section
of the income tax ordinance explains his tax treatment of such salary?
Ź £ection 110
Ź £ection 101
Ź Section j02
Ź £ection 50
Ref: ^
£
£
£
#G

.

D
Ô$! `$#.c

If a business carried on by Non-resident person in Pakistan through permanent establishment

what will be the tax treatment of the traveling expenditures born by the non-resident for spending
his holidays in his home land?
Ź Wholly t le due to P
Ź Wholly taxable as no concerned with PE in Pakistan
Ź Not permissible as deduction from the income of Non-resident
Which of the following section of Income Tax Ordinance 2001 deals with Income from £alary
and its treatment?
Ź £ection 11
Ź Section j2
Ź £ection 13
Ź £ection 14
D
Ô$, `$#.c

Mr. X non-resident of Pakistan earned income from property situated in Dubai Rs. 70,000 but
received in Pakistan. Which one of the following option is right for this particlar scenario?
Ź `. eing non-esident of P ist n Rs. 70,000 will e dded in Goss tot l incoe
Ź Mr. X being non-resident of Pakistan Rs. 70,000 will be subtracted in Gross total income
Ź Mr. X being non-resident of Pakistan Rs. 70,000 will be claimed as admissible deduction
Ź Mr. X being non-resident of Pakistan Rs. 70,000 will be exempted

Mr. X employed in Pakistan received share of profit Rs. 60,000 in India from a business situated
in Dubai but controlled through PE in Pakistan. Which of the following is right for the above
scenario?
Ź `. eing esident of P ist n Rs. 60,000 will e dded in Goss tot l incoe
Ź Mr. X being resident of Pakistan Rs. 60,000 will be subtracted in Gross total income
Ź Mr. X being non-resident of Pakistan Rs. 60,000 will be added in Gross total income
Ź Mr. X being non-resident of Pakistan Rs. 60,000 will be subtracted in Gross total income
Ref: c
77
What is meant by reduction in tax liability? Give an example from Income Tax ordinance 2001?
If Mr. Kamal resident of Pakistan suffered a foreign loss against the income received from
foreign country in tax year. What is the treatment of such foreign loss? Which section deals this
kind of loss? £uch losses can be carried forward up to how many years?
Question o: 3j ( ` s: 5 )
Define the following under the Income Tax Ordinance 2001 with their respective sections:
Resident Individual
Resident Associations of Persons
If Mr. Basit resident of Pakistan suffered a foreign loss against the income received from foreign
country in tax year 2008-09. What is the treatment of such loss? Which section deals this kind of
loss?
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Calculation: Income from poultry form = 645,000

Profit on shares(136000*75/100) = 102000

Less: Capital losses = 15000

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