FIN623 All in One Mega File

FIN623- Taxation Management · FINALTERM PAPER · ALL IN ONE · SOLVE BY MUHAMMAD JUNAID ANWER · BEST QUIZS ABOVE 350

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Q1. Mr. Sufyan has rented out his house at Rs. 80,000 per month. As per rent deed (1 marks)

he has received an amount of Rs. 150,000 as advance, which is non adjustable against rent. What would be the amount of rent chargeable to tax?

1. Rs. 40,000
2. Rs. 975,000
3. Rs. 73,000
4. Rs. 100,800

Correct answer: Rs. 975,000

(150000/10)=15000 80000*12=960000+15000=975000

Treatment of Non-Adjustable Amounts Received in Relation to Buildings

These amounts shall be treated as rent and chargeable to tax under the head “income from property”. These amounts are spread over a period of 10 years, It is adjustable as Rent.

Q2. Sec. (11A) of Income Tax Ordinance 2001 defined: (1 marks)

Charitable purpose includes relief of the poor, education, medical relief and the advancement of any other object of general public utility. In which criteria the above definition falls?

1. Exclusive definition
2. Inclusive definition
3. Both Exclusive and Inclusive definitions
4. Statutory definition

Correct answer: Inclusive definition

(11A) “charitable purpose” includes relief of the poor, education, medical relief and the advancement of any other object of general public utility; PAGE 8

Q3. Which of the following is the mutual example of both inclusive and exclusive definitions? (1 marks)

1. Appellate Tribunal 2(2)
2. Banking Company 2(7)
3. Association of Person 2(6)
4. Employment 2(22)

Correct answer: Banking Company 2(7)

Exclusive as well as Inclusive Definition:

Such definitions contain both elements as enumerated above.

Examples of above type of definitions are given below:

Sec 2(7) banking company means a banking company as defined in the banking companies ordinance, 1962 and includes any body corporate which transacts the business of banking in Pakistan. PAGE 9

Q4. Which of the following is the Special Accounting Year of Sugar Companies? (1 marks)

1. 1st January to 31st December
2. 1st July to 30th June
3. 1st October to 30th September
4. 1st September to 31st August

Correct answer: 1st October to 30th September

Q5. Taxes are important instrument of which one of the following policy? (1 marks)

1. Monetary policy
2. Fiscal policy
3. Trade Policy
4. Economic Policy

Correct answer: Fiscal policy

Taxes are important instrument of Fiscal Policy. PAGE 1

Q6. Which of the following is opposite to the literal meanings of Tax? (1 marks)

1. Burden
2. Strain
3. Load
4. Relieve

Correct answer: Burden

Q7. Suppose a Profit acquired by a cultivator for produce after harvesting. The profit of the cultivator will be treated in (1 marks)

1. Income from Business
2. Agriculture Income
3. Income from Property
4. Capital Gain

Correct answer: Agriculture Income

Q8. Suppose due to hailstorm damages caused to crops that was insured against Insurance policy. The compensation received from an insurance company for damages caused by hailstorm. (1 marks)

What will be the tax treatment of such amount received?

1. Income from Business
2. Exempt as Agriculture Income
3. Income from Property
4. Capital Gain

Correct answer: Exempt as Agriculture Income

Following Income are held to be “Agricultural Income”

Compensation received from an insurance company for danger caused by hailstorm or another natural calamity to crops or agricultural produce. PAGE 20 So agricultural income always exempt for tax.

Q9. What is the tax treatment of any profit on the US Dollar Bonds purchased by the resident person after December 1999 under Second Schedule? (1 marks)

1. Wholly exempt
2. Wholly taxable
3. Tax 10% of profit paid
4. Not mention in second schedule

Correct answer: Tax 10% of profit paid