Income Tax Laws

MCQs
Rate of tax for long term capital gain is:-
a) 15%
b) 20%
c) 10%
d) 30%
What should be subtracted from Gross Annual Value(GAV) to
reach Net Annual Value(NAV)
• Municipal taxes
• Expected rent
• Actual rent
• None of the above
Any profit or gains arising from transfer of __________ asset is
chargeable under head capital gains-
• Capital Assets
• Floating Assets
• Transferable Assets
• None of the above
If any asset other than residential house is sold and another
residential house property is purchased then capital gain arising
will be exempt under-
• Section 54
• Section 54B
• Section 54EC
• Section 54F
Income Tax Act was passed _____________. 
• A. 1955 
• B. 1961 
• C. 1956 
• D. 1939
Direct Tax is collected from_______. 
• A. customer 
• B. buyer 
• C. employees 
• D. persons
Income tax is levied on-
• Monthly basis
• Quarterly basis
• Half yearly basis
• Yearly basis
Which transaction is a capital receipt?

• A. cash received from sale of inventory

• B. bank interest received on deposits

• C. premises rent received from the tenant

• D. proceeds of sale of equipment

 Surcharge of 10 per cent is payable by an individual where
the total income exceeds:
a) Rs.7,50,000
b) Rs.8,50,000
c) Rs.50,00,000
d) None of the three
Income tax is rounded off to:

a) Nearest ten rupees

b) Nearest one rupee
c) No rounding off of tax is done
A’s Total Income for the A.Y. 2018-19 is Rs.2,50,000. His tax
liability shall be-

a) 10,000
• b) 10,300
• c) 11,330
• d) Nil
A business bought a new computer system for office use.
Which of the following is treated as revenue
expenditure?

A. computer speaker
B. computer software 
C. laser printer cartridge refill
D. laser printer
Income Tax is imposed on a person by-
A.State Govt.
B.Central Govt.
C.Both of the above
D.None of the above
Which of the following statements is incorrect?
A.Income tax is a direct tax
B.Wealth tax is a central govt. tax
C.GST is an example of direct tax.
D.Entry tax is a state govt. tax.
The term "Person" includes
A. A Registered Firm
B. An Unregistered Firm
C. All of the above
D. None of the above
Dearness allowance is a type of-
• Fully taxable allowance
• Fully exempt allowance
• Partially taxable allowance
• None of the above
Transport allowance in case of handicapped person is exempt up
to-
• Rs. 1000 per month
• Rs 1500 per month
• Rs 1600 per month
• Rs. 3200 per month
Children education allowance is exempt up to-
• Rs. 50 per month per child
• Rs. 100 per month per child
• Rs 150 per month per child
• Rs 300 per month per child
If any employee is living in his own house, HRA received will be
• Fully taxable
• Fully exempt
• Partially taxable
• Can’t be determined
Which of the following is fully exempt allowance-
• Lunch Allowances
• Marriage Allowance
• Family Allowance
• Allowances from U.N.O
Maximum rebate for individuals having taxable income of less
than Rs. 3,50,000 is-
• Rs. 1500
• Rs. 2000
• Rs. 2500
• Rs. 3500
Annual value of property consisting land or building is
calculated under which head of income tax-
• Salary head
• House property head
• Capital Gain Head
• Other sources head
Municipal Rental Value – Rs 30,000
Fair Rental Value – Rs. 36,000
Expected Rental Value shall be-
• 30,000
• 36,000
• 6,000
• None of the above
Under which type of capital gains Indexation is done-
• Short Term Capital Gain
• Long Term Capital Gain
• Mid Term Capital Gain
• None of the above
Thank You