Tax Planning and Management MCQs [set-4]

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
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A. Revenue expenditure
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B. Capital expenditure a
C. Speculative transaction expenditure
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D. Illegal expenditure

Answer: A
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77. --------- is the implementation of the plan of tax

A. Tax evasion

B. Tax avoidance

C. Tax management

D. None of these

Answer: C

78. Which of the following is an objective of tax management?

A. Minimize litigation

B. Productive investment

C. Compliance with legal formalities

D. Healthy growth of economy

Answer: C

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79. The method by which a person illegally reduces his tax burden by
either deflating their income or inflating their expenses is known as

A. Tax planning

B. Tax evasion

C. Tax management

D. Tax avoidance

Answer: B

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80. ------ refers to hedging of tax? .c
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A. Tax planning a
B. Tax evasion
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C. Tax management

D. Tax avoidance
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Answer: D

81. Company is defined under

A. Section 2 (17)of the Income Tax Act

B. Section 2 (32)of the Income Tax Act

C. Section 2 (14)of the Income Tax Act

D. Section 2 (12)of the Income Tax Act

Answer: A

82. Whichof the following deals with Domestic Company?

A. Sec 2 (234)

B. Sec 2 (224)

C. Sec 2 (22)

D. Sec 2 (26)

Answer: B

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83. Section 2 (234) relates to

A. Indian company

B. Domestic company

C. Foreign company

D. Widely held company

Answer: C

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84. A company in which the public is not substantially
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as
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at
A. Domestic company

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B. Foreign company
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C. Widely held company
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D. Closely held company

Answer: C

85. Section 80 JJAA deals with

A. Deduction in respect of produced companies

B. Production in respect of certain incomes

C. Deduction in respect of employment of new employee

D. Deduction in respect of profits and gains from undertakings an enterprise in special category
states

Answer: C

86. Expenditure incurred by an hotelier on replacement of linen and

carpets in his hotel. Such expenditure shall be considered as

A. Revenue expenditure

B. Deferred revenue expenditure

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 C. Capital expenditure

D. Illegal expenditure

Answer: A

87. The maximum deduction available under section 80 C is

A. Rs50000

B. Rs100000

C. Rs150000
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D. Rs200000
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Answer: C
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88. The Presumptive Taxation Scheme of Section 44 AD can be adopted by
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A. Resident Individual tax payers

B. Hindu Undivided Families

C. Partnership firms except Limited Liability Partnership Firms

D. All of these

Answer: D

89. Deemed dividend is defined in

A. Section 2 (22)(a)

B. Section 2 (21)(a)

C. Section 2 (23)(a)

D. Section 2 (22)(c)

Answer: A

90. 80 ID deals with tax holiday for

A. Hospitals

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 B. Hotels

C. Natural gas

D. Eligible business

Answer: B

91. An assessee incurred expense of tax on non monetary perquisites of

employees. Such expenditure shall be considered as

A. Revenue expenditure

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B. Deferred revenue
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C. Capital expenditure
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D. Expressly disallowed

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Answer: D
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92. Flat rate of corporate tax for a domestic company with annual turnover
up to Rs250 crore is

A. 15%

B. 25%

C. 30%

D. 35%

Answer: B

93. Flat rate of corporate tax for a domestic company with annual turnover
more than Rs250 crore is

A. 15%

B. 25%

C. 30%

D. 35%

Answer: C

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94. Flat rate of corporate tax for a foreign company is

A. 15%

B. 25%

C. 30%

D. 40%%

Answer: D

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95. Which of the following shall not be regarded as capital asset?
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A. Jewellery
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a
B. Rural Agricultural land

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C. Archaeological Collections
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D. Paintings
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Answer: B

96. Which of the following is not a capital expense?

A. Installation expenditure of plant of a company.

B. Legal expenses for reduction of capital.

C. Commission to employees to achieve sales Targets.

D. Expenses of promoting a company.

Answer: C

97. Which of the following donations is eligible for 100 % deduction?

A. Help to poor

B. National DefenceFund

C. Rajive Gandhi Foundation

D. Any notified temple

Answer: B

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98. Indexation is applicable to.......................

A. Sale of short term capital assets.

B. Sale of long term debentures.

C. Sale of depreciable capital assets.

D. Sale of long term capital assets which are not depreciable assets

Answer: D

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99. XYZ & Co. incurred a liability by giving discount on issue of
debentures. Such expenditure shall be considered as .c
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A. Revenue expenditure a
B. Deferred revenue expenditure
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C. Capital expenditure

D. Illegal expenditure
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Answer: B

100. The objectives of tax planning is to minimise .........?

A. tax liability

B. finance liability

C. tax return

D. none of these

Answer: A

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