Taxmann's Tax Laws (TAX) | MCQs

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COMPUTATION OF INCOME UNDER VARIOUS HEADS

PART 1 : INCOME UNDER THE HEAD “SALARIES”

BASICS

1. Which of the following Section enumerates the five “Heads of Income” under which the Income of the assessee may fall:

5. In which of the following cases, Employer-Employee relationship exists and therefore the income is taxable under the head “salaries”

2. The relevant sections for computation of Income under the head Salaries are:

3. As per Section 15 of the Income-tax Act, Salary is taxable on:

6. A professor of a college receives monthly salary from the college. He is appointed by the University as examiner during the final exams conducted by the university. In this case the remuneration received as an examiner is taxable under the head:

4. The most fundamental requisite for charging income under the head “Salaries” is :

7. Sargam is a qualified doctor. She joined Arpana hospital as an employee on monthly salary. Their contract of service contained a clause restraining her to pursue practice beyond employment and paid her ` 3,00,000 as compensation for the same. The income will be taxable as:

8. As per Section 9(1)(ii), salary is deemed to accrue or arise in India if services are rendered in India. Section 9(1)(iii) gives exception to the above provision. It states: a

c d 12. “Salary” under section 17(1) includes the following, except:

a b c d

13. Which one of the following is not a deduction under Section 16 of the Income-tax Act:

a b

c d

c d

9. Whose income is taxable under the head “Salaries” despite no employer- employee relationship.

14. Simar has received salary from her employer during the Previous Year (P.Y) 2022-23 net of deduction of ` 80,000 on account of Tax deducted at source and ` 84,000 as provident fund contribution of the employee. She has received ` 6,36,000 during the year. What is her Gross Salary for the year?

a

c

10. In relation to definition under Section 17 of the Income-tax Act, the following are defined, except a b c d

11. In which of the following situation, Salary will not be taxable: a

15. Suhani was employed in X Ltd. in the grade of ` 8,000-500-12,000-1000-20,000. She joined on 1.8.2018. What is her Gross salary income for P.Y 2022-23, if her salary is due on the last day of the month?

16. What will be the amount of gross salary which shall be required to be declared in the return of income to be filed for the previous year 2022-23 by Harun, who joined services as Manager Accounts on

the salary of ` 17,000 p.m. in XYZ Ltd. on 1st April, 2019 in the grade of 15,0002000 - 19,000 - 3000 - 28,000 ?

a `

b `

c `

d ` [CS. Executive Dec. 2019]

17. Mr. Anjan joins a service in the grade of ` 15,600-39,100 plus grade pay of ` 6,000 on 1.8.2022. He also gets dearness allowance @107% of salary. His tax liability for AY 2023-24 will be -

a b `

c `

d ` [CS. Executive Dec. 2014]

18. Pankaj joins service on 1st April, 2018 in the grade of 15,000-1,000-18,000-2,00026,000. His Gross salary for the year ended on 31st March, 2023 will bea

d ` [CS. Executive Dec. 2015]

19. Mr. Joseph joined government job in the grade of 18,000 -1500-22500-2000-28,500 on 15.7.2017. His salary is due on the first day of next month. What will be his basic salary for the P.Y. 2022-23?

21. The Salary of Mr. John is ` 60,000 p.m. He however took Advance Salary of 5 months from his employer on 10.1.2023. His salary is due on first day of next month. What is his gross salary for P.Y. 2022-23? a

22. Mr. Shravan is on a salary of ` 40,000 p.m. He also took advance of ` 2,00,000 against salary, on 1.3.2023. What will be his salary income for P.Y. 2022-23 after allowing standard deduction of ` 50,000?

23. Which of the following allowance is fully taxable?

a

24. Which of the following allowances are fully exempt?

a b

20. Mr. X is employed in HCL Ltd. since 1.7.2012 in the pay scale of 10,000 -500 -14,000 - 1000 - 19,000. The employer paid him Dearness Allowance (D.A.) @ 10% of Basic salary up-to 31.8.2022 and thereafter @ 20% of basic salary. His gross salary for the P.Y 2022-23 is:

25. Which of the following allowance is fully taxable?

26. As per section 10(14)(ii) and [Rule 2BB(2)] of the Income-tax Rules, 1962 the extent to which Compensatory Field Area allowance is exempt is ` :

31. House rent Allowance (HRA) is exempt under Section ----- of the Income-tax Act. a

27. As per section 10(14)(ii) and [Rule 2BB(2)] of the Income-tax Rules, 1962 the extent to which Compensatory Modified Field Area allowance is exempt is ` :

32. The amount of exemption in respect of HRA received depends upon the following except:

28. As per section 10(14)(ii) and [Rule 2BB(2)] of the Income-tax Rules, 1962 the special allowance in the nature of Counter Insurgency Allowance granted to the members of armed forces operating in areas away from their permanent locations is exempt to the extent of ` :

33. The HRA is exempt under Rule 2A of the Income Tax Rules. The least of the three will be exempt, the word “three” includes the following except:

29. Which of the following allowance is available only to the members of armed forces?

34. For the purpose of calculation of HRA, salary means: a

b Basic salary + DA (forming part of salary for retirement benefits) + monthly commission c

35. For the purpose of calculation of HRA salary is taken on:

30. The assessee is a citizen of India and an employee of Central Government working in Canada. The government provides him certain allowances. These allowances will be exempt in the hands of assessee if he is:

36. Mr. X is employed with XY Ltd. on a basic salary of ` 10,000 p.m. He is also entitled to Dearness allowance @ 100% of

basic salary, 50% of which is included in salary as per terms of employment. The company gives him house rent allowance of ` 6,000 p.m. which was increased to ` 7,000 p.m. with effect from 01.01.2023. He also got an increment of ` 1,000 p.m. in his basic salary with effect from 01.02.2023. Rent paid by him during the previous year 2022-23 is as under:

April and May, 2022 Nil, as he stayed with his parents.

June to October, 2022 ` 6,000 p.m. for an accommodation in Ghaziabad.

November, 2022 to March, 2023 ` 8,000 p.m. for an accommodation in Delhi.

Compute the HRA exempt u/s 10(13A) for Assessment Year 2023-24.

d

[CS Executive June 2021]

39. Murali is employed in Megha Ltd., Delhi. He is paid house rent allowance of ` 9,000 per month in financial year 2021-22. His salary for the purpose of computation or house rent allowance relief may be taken as ` 20,000 per month. Murali pays actual rent of ` 10,000 per month. How much of the house rent allowance is tax-free -

b

c

d ` [CS. Executive June 2016]

37. Compute taxable amount of house rent allowance in the following cases:

40. Mr. A is employed in ABS transports as cabin driver. He is paid ` 15,000 every month in the whole of previous year as allowance for meeting his personal expenditure in the course of running the goods vehicle. Mr. A does not receive any other amount by way of daily allowance. The amount of allowance eligible for exemption is:

a

b

c

d [CS. Executive June 2017]

41. The following allowances are exempt u/s 10(14) to the extent the expenses are actually incurred or amount received whichever is less, except:

a

b

38. Chaturvedi is employed in a company at Delhi. He was paid monthly house rent allowance of ` 15,000 during the previous year 2021-22. His Basic pay + DA (eligible for retirement benefits) for the year ended 31st March, 2022 is ` 12 lakhs. Chaturvedi paid ` 20,000 as rent per month for the accommodation occupied by him throughout the year. Compute the amount of HRA exempt from tax.

42. Shubhra received academic and research allowance of ` 60,000 from her employer during the P.Y 2021-22. On 15.11.2021 she spent on research ` 42,000 and on 23.3.2021 she again spent ` 12,000. Another ` 8,000 were spent by her on 4.04.2021. The amount of exemption u/s 10(14) will be restricted to:

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43. Mr. Murthy is employed in ABC Management Institute, Pune. He is eligible for ` 24,000 as allowance for the year towards academic and research work. The amount of academic and research allowance chargeable to tax, if he did not spend any money for the purpose, is:

48. Sonu received ` 240 per month as education allowance for his 3 children in the P.Y. 2021-22. What is the amount of exemption he is entitled to as per section 10(14)?

44. The following are the allowances which are exempt u/s 10(14) to the extent of amount received or the limits specified as per income tax, whichever is less, except:

49. Children education allowance received by an employee from his employer is ` 80 per month per child for 3 children. Taxable education allowance will bea

b

c

d

[CS. Executive Dec. 2014]

50. Mr. X has two sons. He is in receipt of children education allowance of ` 150 p.m. for his elder son and ` 70 p.m. for his younger son. Compute his taxable allowance.

45. The tribal area allowance is exempt up-to a maximum ceiling limit of:

46. Shiv Ram was posted to Madhya Pradesh for 4 months and was given tribal area allowance of ` 2000. Find the taxable amount in the hands of Mr. Shiv Ram:

51. Mr. Vivek is entitled to ` 5,000 pm. as Medical Allowance. He spends ` 4,000 per month on his medical treatment and ` 500 on the medical treatment of his major son not dependent on him. The medical allowance exempt will be:

47. The children education allowance is exempt up-to a maximum ceiling limit of:

52. Mr. Amit is entitled to a transport allowance of ` 1,000 per month for commuting from his residence to office and back. He spends ` 800 per month. The amount of exemption will be:

53. Where there is a decision to increase the D.A. in March, 2021 with retrospective effect from 1/4/2019, and the increased D.A. is received in April, 2021 the increase is taxable -

57. A Central Government Officer received during the year 2021-22 salary excluding all allowances of ` 9,00,000 and amount of entertainment allowance of ` 12,000 @ ` 1,000 p.m. The maximum amount of entertainment allowance so received by him being exempt under section 16(ii) of the Act is ………………………………..

54. Salary for the purpose of computation of exemption of entertainment allowance in the hands of Government employee means:

[CS. Executive Dec. 2019]

58. Ravi is receiving ` 10,000 as medical allowance from his employer. Out of this, he spends ` 5,000 on his own medical treatment ` 2,000 on the medical treatment of his dependent wife and another ` 3,000 for the medical treatment of his major son who is not a dependent on him. The amount of medical allowance taxable in his hand is -

b `

55. Geetesh is a Central Government employee and has received ` 20,000 as entertainment allowance. He spent ` 15,000 for entertaining the business clients. His basic salary for the Previous Year 2021-22 is ` 80,000 and he also gets 20% dearness allowance as part of salary. The amount of Entertainment allowance deductible u/s 16(ii) will be:

c `

d [CS. Executive June 2016]

56. For the purpose of Entertainment allowance, Government employee means:

59. Paresh, a Company Secretary working in Roly Poly Ltd. Chennai besides Salary, HRA, DA and Bonus was also getting fixed medical allowance of ` 10,000 from the employer. He spent out of the medical allowance so received an amount of ` 6,000 on his treatment, ` 2,000 on the treatment of his wife and ` 1,000 on the treatment of his major son not dependent on him. The amount of medical allowance received and to be exempt for Assessment Year 2022-23 shall be................

b

c `

d ` [CS Executive Dec. 2020]

60. Pawan, employed in Magic Ltd. was eligible for transport allowance of ` 2,000 per month to meet his travel expenses from residence to office. He actually incurred ` 1,200 per month towards travel. The amount of travel allowance chargeable to tax would be-

d [CS. Executive Dec. 2016]

61. Zeba gets ` 1000 per month as transport allowance for commuting between office and residence. The amount that will be taxable in her hands will be: a

66. Mr. Amit employed in X Co. Ltd., in Salem, received ` 10,000 per month as house rent allowance in the year 2021-22. His total salary is ` 4 lakhs consisting of Basic pay + DA. He paid rent of ` 8,000 per month. How much of HRA is exempt from tax? a

[CS. Executive Dec. 2017]

RETIREMENT BENEFITS

62. Sushil is a handicapped employee who receives ` 3,500 p.m. as transport allowance. The amount of exemption that Mr. Sushil will get in the P.Y. 2020-21 is:

67. The maximum ceiling limit of exemption for the purpose of exemption under section 10(10)(ii) i.e. Employee covered under the Payment of Gratuity Act, 1972 is:

63. Mr. Y is a visually impaired person. He is employed in a public sector undertaking since 1-6-2019. He was paid 30,000 for the financial year ended 2021-22 by way of transport allowance. How much of transport allowance is exempt from income-tax ? a

d [CS Executive June 2021]

64. Island duty allowance is exempt up to a maximum ceiling of : a

68. The maximum ceiling limit of exemption for the purpose of exemption under section 10(10)(iii) i.e. an employee not covered under the Payment of Gratuity Act, 1972 is:

a

b

c

69. The maximum amount of any death-cum-retirement gratuity received by an employee not covered under the Payment of Gratuity Act, 1972 on Superannuation from the employer, exempt from tax is of ……………………….

65. Allowances and perquisites allowed to an employee for services rendered outside India are tax free in case ofa

[CS. Executive Dec. 2016]

d

[CS. Executive Dec. 2019]

70. After serving for 28 years and 7 months in M Steels Ltd., Nitin retired on 30th September, 2022. He is covered by the Payment of Gratuity Act, 1972.

The company has paid him a gratuity of ` 14,21,500. At the time of retirement, he was getting basic salary ` 37,800, dearness allowance ` 3,800 mid house rent allowance ` 5,200 per month. However his average salary for last 10 months is ` 36,400. Determine the amount of gratuity exempt under section 10(10) of Income Tax Act, 1961.

`

` [CS. Executive Dec. 2022]

71. The maximum ceiling limit of exemption for the purpose of exemption under section 10(10AA), Leave encashment at the time of retirement is:

[CS. Executive Dec. 2017]

72. The maximum ceiling limit of exemption for the purpose of exemption for voluntary retirement compensation under section 10(10C) a

75. For the purpose of Encashment of earned leave, Government employee means:

73. The maximum ceiling limit of exemption for the purpose of exemption of retrenchment compensation under section 10(10B)

76. For the purpose of Pension, Government employee means:

74. For the purpose of Gratuity, Government employee means:

77. For the purpose of Rent free accommodation, Government employee means:

78. Mr. Vijay employed in ABC Ltd. opted for voluntary retirement and received ` 22

4.10

lakhs by way of gratuity. The payment of Gratuity Act, 1972 is applicable in his case. The monetary limit for exemption under section 10(10) is:

a

b

c

d

[CS. Executive Dec. 2017]

79. Salary for the purpose of computation of exemption of Gratuity for an employee covered under the Payment of Gratuity Act,1972 is:

82. If an employee has completed 11 years & 6 months of service, the number of completed years for the purpose of computing exemption of a non-government employee covered under Payment of Gratuity Act, 1972 will be:

a b

83. If an employee has completed 11 years & 6 months and 5 days of service, the number of completed years for the purpose of computing exemption of a non-government employee covered under Payment of Gratuity Act, 1972 will be: a

80. Salary for the purpose of computation of exemption of Gratuity for an employee not covered under the Payment of Gratuity Act, 1972 is:

84. If an employee has completed 11 years & 6 months and 5 days of service, the number of completed years for the purpose of computing exemption of a non-government employee not covered under Payment of Gratuity Act, 1972 will be: a

81. Mr. X was employed in ABC Ltd. getting basic pay ` 18,000 p.m. but it was increased to ` 24,000 p.m. w.e.f. 01-07-2022, dearness allowance ` 6,000 p.m. but it was increased to ` 9,000 p.m. w.e.f. 01-07-2022 (50% of DA forms part of salary). The employee was retired on 10.01.2023 after serving the employer for 20 years and 10 months. The employer has paid him gratuity of ` 9,10,000 and the employee was covered under Payment of Gratuity Act, 1972. The taxable portion of gratuity will be:

85. Shivani has already availed exemption of gratuity under section 10(10) (ii) to the extent of ` 1,80,000, and thereafter she gets gratuity of ` 3,25,000 from her new employer at the time of retirement. The maximum ceiling limit of exemption for her would be: a

86. For the purposes of computation of gratuity exempt under section 10(10)(ii) and section 10(10)(iii) the total number of days in a month are reckoned as---------& ------------------ respectively:

d ` [CS. Executive Dec. 2015]

87. No. of days in a month for purposes of computing taxable Gratuity in case the employee is covered under the Payment of Gratuity Act, 1972, are:

[CS. Executive Dec. 2021]

88. Akash is entitled to get a pension of ` 6,000 per month from a private company. He gets 60% of the pension commuted and receives ` 3,60,000. He also receives ` 2,00,000 as gratuity from the same employer. The taxable portion of commuted value of pension will be -

91. Mr. Jugal is entitled to get ` 20,000 per month as pension from a private company after his retirement on 31.12.2022. He gets 60% of the pension commuted on 1st February 2022 and receives ` 3,60,000. He also receives ` 2,00,000 as gratuity from the same employer. His salary is due on the first day of the next month. The taxable value of un-commuted pension will be -

92. Mr. Jugal is entitled to get ` 20,000 per month as pension from a private company after his retirement on 31.12.2022. He gets 60% of the pension commuted on 1st February 2023 and receives ` 3,60,000. He also receives ` 2,00,000 as gratuity from the same employer. His salary is due on the last day of the month. The exempted value of commuted pension will be -

d ` [CS. Executive Dec. 2014]

89. An employee of a company who was entitled for a gratuity of ` 8,00,000 also received ` 12,00,000 by commuting 40% of his pension. The taxable amount of commuted pension is -

[CS. Executive June 2016]

90. Rohan retires from private service on 30th April, 2022 and his pension has been fixed at ` 1,500 p.m. he gets ½ of his pension commuted during January, 2023 and receives ` 75,000. He also gets ` 60,000 as gratuity. The total taxable pension for the P.Y. 2022-23 including commuted value will be -

93. Mr. Jugal is entitled to get ` 20,000 per month as pension from a private company after his retirement on 31.12.2022. He gets 60% of the pension commuted on 1st February 2022 and receives ` 3,60,000. He also receives ` 2,00,000 as gratuity from the same employer. His salary is due on the last day of the month. The taxable value of pension will be -

94. Mr. X a government employee retired w.e.f 01.10.2022 receiving ` 5,000 p.m. as pension. On 01.02.2023, he commuted

4.12

60% of his pension and received ` 3,00,000 as commuted pension. He also received gratuity of ` 2,50,000. You are required to compute his taxable pension if his salary is due on the first of next month: a

retirement and his average salary for last 10 months is ` 24,000. The taxable amount of leave encashment would be: a

b

d ` [CS. Executive Dec. 2016]

95. The maximum amount of Gratuity exempt and the maximum amount of leave encashment exempt under the act respectively are:

[CS. Executive June 2018]

96. The employer allows 24 days leave to the employee for every completed year of service. The employee joined service on 20.1.2006 and took retirement on 31.12.2022. The number of days of leave standing to his credit at the time of retirement if has not availed any leave and neither encashed during service is:

99. Mohan retired from Y & Company Ltd. on 31.08.2022 after rendering services for 31 years and 7 months. He was paid ` 11 lakhs as gratuity under the Payment of Gratuity Act, 1972. His last drawn salary was ` 52,000. How much of the amount of gratuity would be exempt? a

c

d

[CS. Executive June 2019]

100. Rohan, an employee of State Government received ` 1,000 per month as entertainment allowance during the year. His salary excluding any allowance, benefit or other perquisite for the year is ` 8,40,000. The amount of entertainment allowance eligible for deduction is:

a

b ` i.e. `

c

97. Aayush was employed in XYZ Ltd. and has completed 18 years 7 months and 20 days of service. His employer gave 40 days leave for each completed year of service. He also took leave of 240 days during service. How many days leave stand to his credit at the time of retirement as per section 10(10AA)? a

d ` ` [CS. Executive June 2019]

101. John who recently retired from service of a company on 31st March, 2023 is eligible for a monthly pension of ` 20,000. He has received gratuity on his retirement also. He wants to commute 50% of his pension for ` 6 lakh. How much amount of this commuted pension shall be subject to tax in A.Y. 2023-24? a

98. An employee of public limited company received ` 3,00,000 as encashment of leave salary at the time of retirement. He has 18 months leave to his credit at the time of

[CS. Executive June 2019]

102. Priya, (Non-Government Employee) an employee of S Ltd. have received the

amount of retrenchment compensation as she is going out of the company due to the retrenchment process. The total years she worked in the company is 17 years. The average pay equals to 15 days is ` 30,500. You are required to compute the income which is chargeable under the head salaries in the hands of Priya. (Assessee has not opted for section 115BAC).

d [CS. Executive June 2022]

PERQUISITES

103. For the Purpose of calculating value of Rent free accommodation as per Rule 3(1) of the Income-tax Rules, 1962, the population of a city is considered as per ------------- census.

106. Ramesh, an employee of Gauri & Co. of Delhi, received the following payments during the previous year ended 31st March, 2023: Basic salary: ` 2,40,000 and dearness allowance - 40% of basic salary (40% forming part of salary). Rent-free unfurnished accommodation provided by employer for which rent paid by employer being ` 50,000. The value of taxable perquisite in the hands of Ramesh will be: a

d ` [CS. Executive Dec. 2014]

107. The perquisites provided by the employer to the employee or any member of the household shall be chargeable to tax in the hands of employee. For the meaning of “household” it includes:

104. Rent free accommodation is taxable in the hands of government employees as per:

108. Kapil gets salary of ` 12,000 p.m. and is provided with rent-free unfurnished accommodation Pune (Population 31 Lakh). House is owned by employer, fair rental value of which is ` 1,400 p.m. House was provided with effect from 1st July, 2022. Value of the perquisite of rent-free accommodation will be -

105. Mr. Rohit is an employee of Central Government on deputation to a Public sector undertaking. The house is provided to him in Delhi by the Government. His salary is ` 8,20,000. The license fees, as per Government rules is ` 2000 per month. The value of perquisite will be:

d

[CS. Executive Dec. 2015]

109. A specified employee would include, an employee of the company who is also:

110. Satish is employed as chief engineer in Gama Ltd. Chennai w.e.f. 1st April,

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2022 for a consolidated salary of ` 60,000 per month. He is provided with rent -Free unfurnished accommodation owned by the employer from 1st July, 2022 onwards. The value of taxable perquisite is -

a `

b `

c `

d ` [CS. Executive June 2016]

111. Mr. Arjun employed in KL (P.) Ltd. at Mumbai was provided rent-free accommodation by the employer who owned such accommodation. The salary income of Mr. Arjun for the purpose of computing the perquisite value is ` 8 lakhs. The perquisite value of rent-free accommodation in the hands of Mr. Arjun is:

a i.e. `

b i.e. `

c

d i.e. ` [CS. Executive June 2017]

112. The employer provided rent free unfurnished accommodation to his employee. The house was rented by the employer on a rent of ` 1,50,000 p.a. but he has given a interest free refundable security deposit of ` 10,00,000 to the landlord. The assessing officer is of the opinion that value of perquisite shall include a notional interest @ 12% p.a. The salary for the purpose of computing the value of rent free accommodation is ` 12,00,000. The Value of perquisite in respect of the house shall be considered as:

a

b

c ` i.e. `

d

113. Mr. X has been provided a servant by his employer. The salary paid to the servant is ` 5,000 per month. Mr. X is not a specified employee. The amount taxable in the hands of Mr. X, in this regard would :

114. The employee is provided with furniture costing ` 1,50,000 along with house w.e.f. 1.7.2022. The value of the furniture to be included in the valuation of unfurnished house shall be:

c `

d ` [CS. Executive June 2017]

115. Mr. Balan is employed in SS Ltd. at Madurai (Population exceeding 25 lakhs as per 2001 census). He is provided with a rent-free accommodation owned by the employer. The percentage of salary to be adopted for the purpose of valuation of perquisite would be:

a

b

c

d [CS. Executive Dec. 2017]

116. An employer provided free refreshment to his employee for which he incurred an amount of ` 80 per such refreshment. State the amount which is treated as a perquisite for the employee and its taxable value as per sec. 115BAC of the Income-tax Act, 1961 for the Assessment Year 2023-24 : a

d [CS. Executive June 2022]

117. The Employer provides a car (below 1600 cubic capacity) along with a driver to his employee who uses the car partly for official and partly for personal purpose. The expenses are incurred by the employee. The taxable value of perquisite is:

118. Harsh (age 45 Years) is appointed as Vice-President in High Hope India Ltd., Mumbai on 1-2-2020. He has been provided a car of 2000 cubic capacity (CC) which is exclusively used by him for private and personal purposes only. The actual cost of the car is ` 18,00,000 and the monthly expenditure of car of ` 5,000 is fully met by the employer. Perquisite value of car subject to tax in the hands of Harsh in A.Y. 2023-24 would be:

[CS. Executive Dec. 2021]

119. Joy Ltd. transfers a Honda city car to its employee Happy after using it for 4 years and 10 Months for ` 2,10,000. Cost of the car is ` 10,00,000. The value of taxable perquisite in the hands of Happy is -

122. Ashwani is an employee of Bright Public School. His daughter, Asha is studying in the said school at concessional fees of ` 600 per month (Actual fee : ` 4,000 per month) The amount of perquisite taxable in the hands of Ashwani will be: a b

[CS. Executive Dec. 2022]

123. Medical expenditure reimbursed by the employer to the employee for treatment in private hospital will be: a `

[CS. Executive Dec. 2014]

120. Mr. Ankur has taken interest free loan of ` 3,00,000 from his employer for the purpose of medical treatment of his son. The SBI rates are 8% p.a. The expenses on medical treatment were reimbursed by the insurance company. In this case taxable value of perquisite is:

124. Ashok took an interest-free loan of ` 15,000 from B Ltd. (the employer). Assuming that the market rate of interest on similar loan is 10%, the taxable value of the perquisite in the hands of Ashok will bea ` b ` c d [CS. Executive June 2015]

125. The electricity meter is in the name of the employee. The amount of bill which is ` 15,400 was reimbursed by the employer. The employee is not a specified employee. The amount taxable in the hands of the employee will be:

121. Ashraf is an employee of Moon Public school. His daughter, Zara, is studying in the said school at concessional fees of ` 600 p.m. (Actual fee: ` 4,000 p.m.) the amount taxable in the hands of Ashraf will bea

[CS. Executive June 2015]

126. Anil is employed in a company with annual salary of ` 8,60,000 (computed). The company paid income-tax of ` 37,000 on his non-monetary perquisites. He paid ` 1,20,000 to recognised provident fund during the year 2022-23. His taxable income would be-

[CS. Executive Dec. 2017]

127. Under the Income-tax Act, 1961 Child for the purpose of valuation of perquisite of free education will include:

d [CS. Executive Dec. 2017]

131. State which out of the following perquisite is exempt as per section 115BAC of the Income-tax Act, 1961 for the Assessment Year 2023-24: a b

128. Ms. Janhvi is provided with an interest free loan by her employer for the purchase of a house. The value of the perquisite shall be -

[CS. Executive June 2022]

132. Mr. Gupta is given a motor car with chauffeur by the employer which is used for the both official and personal purpose. The entire running expense of the car amounting to ` 64,800 was met by the employer. The cubic capacity of the engine of the motor car exceeds 1.6 liters. The perquisite value of motor car taxable in the hands of Mr. Gupta is -

[CS. Executive June 2017]

129. A company acquired a motor car for ` 8 Lakh on 30th June, 2021. It sold the said motor car to its employee, Jayant, for ` 6 lakh on 10th June, 2022. The company claimed depreciation @ 15% for the year ended 31st March, 2022. The perquisite value in the hands of Jayant on sale of motor car would bea

[CS. Executive Dec. 2017]

130. Company has provided laptop worth ` 50,000 to his employee for official as well as personal purposes. The taxable amount of perquisites will be -

d ` [CS. Executive June 2015]

133. During the previous year, The employee was reimbursed ` 24,000 as medical expenses incurred by him, which includes ` 7,000 spent in Government hospital. The taxable perquisite in this case shall be: a

[CS. Executive June 2015]

134. Mr. Bobby employed in PQR Ltd. was permitted to admit his only son in the school run by the employer. No fee was charged on such education provided to the son of Mr. Bobby. The cost of such education for other children is ` 1,800 per month. The

perquisite value of free education in the hands of Mr. Bobby would be:

a `

b `

c `

d ` [CS. Executive Dec. 2017]

PROVIDENT FUNDS

135. State which of the following perquisite is not exempt perquisite for the assessment year 2023-24 ? a b c d

[CS Executive June 2021]

136. Which of the following is not correct about the approved superannuation fund?

c d

[CS. Executive June 2015]

139. Mrs. Meena retired from service with Sky Ltd. on 31st January, 2023. She received the following amounts from unrecognized provident fund:

i. Own contribution ` 1,50,000

ii. Interest on own contribution ` 21,000

iii. Employer’s contribution ` 1,10,000

iv Interest on employer’s contribution

` 15,000 How much of the receipt is chargeable to tax as income salary -

[CS. Executive June 2016]

140. Ashwin Co. Ltd. contributed 15% of the salary of the employee Virat towards recognized provident fund. The amount liable to tax as perquisite in the hands of Virat would be ……………….. of salary.

` [CS. Executive June 2017]

141. Interest credited to statutory provident fund shall be:

[CS. Executive June 2015]

137. An Employer may contribute not more than --------------% of salary of the employee towards New pension scheme under section 80CCD. a

[CS. Executive June 2017]

138. During the previous year, Barun received a watch worth ` 20,000 from his employer. The taxable value of the watch will bea

142. Ravi is employed in cotton India Ltd. as accounts manager. The employer paid ` 1,60,000 as contribution to approved superannuation fund to benefit the employee Ravi. The amount of such contribution liable to tax as perquisite in the hands of Mr. Ravi is -

c ` d ` [CS. Executive Dec. 2017]

143. When interest on employee’s own contribution from unrecognized provident fund is received, it is:

d ` [CS. Executive Dec. 2017]

144. The year in which unrecognized provident fund is converted to recognized provident fund, this balance is known as transferred balance. It is :

2% of the turnover achieved by him. The turnover achieved by him during the year was ` 50,00,000. He also received a bonus of ` 20,000. The employer contributed ` 25,000 towards recognised provident fund. What is the amount of employer’s contribution taxable under the head Salaries.

148. Employee’s own contribution to recognized provident fund or public provident fund shall be: a b

145. The salary of employee was ` 9,00,000. Employer contributed ` 1,15,000 towards recognised provident fund. The amount of employer’s contribution towards recognised provident fund taxable under the head salary will be:

149. Payment from Recognized Provident Fund after 5 years of continuous service of employee shall be: a b

146. Interest credited to Recognized Provident Fund shall be:

150. The amount or the aggregate of amounts of any contribution made to the account of the assessee by the employer in a recognized provident fund, in the scheme referred to in sub-section (1) of section 80CCD and in an approved superannuation fund will be exempt from tax to the extent of ` ---------- in a previous year

147. Mr. X has Basic salary of ` 90,000 and D.A @ 20% of salary forming part of salary. The commission was fixed @

151. Govt. of India paid salary of ` 5 lakhs and allowances and perquisites valued at ` 2.20 lakhs to a person who is citizen of

India for the services rendered by him outside India for 5 months during the previous year. His total income chargeable to tax after allowing standard deduction would be -

d [CS. Executive June 2015]

DEDUCTIONS

152. Standard deduction up-to ` ----------- is allowed to all employees from Gross salary under section 16(ia).

157. Total income of Nand Kishore under the head ‘Salary’, whose basic salary and DA per month was of ` 40,000 and ` 3,000 respectively and who was also paid leave salary of ` 6,000 and ` 1,000 of professional tax by the employer shall be

[CS. Executive Dec. 2019]

158. Ramavtar, an employee of GG Carriers provides the following details of his income received from the employer for the year ended on 31-3-2023 :

153. Professional or employment tax is charged by:

154. Employment or professional tax, if paid by the employer is

He has contributed ` 9,000 in statutory PF and had also paid ` 1,000 towards LIP premium. His total income for Assessment Year 2023-24 shall be -

155. Employment or professional tax, if paid by the employee is

[CS Executive Dec. 2020]

156. Employment or professional tax is allowed as a deduction from gross salary under section ------------------ of the Income tax Act.

159. Manoj a salaried employee, provides the following information regarding his income for the period 1-4-2022 to 31-32023 where he was employed by Ram Company up to 31st May, 2022 and by Shyam Company from 1st June, 2022. All the figures given in the table below are on per month basis paid by the companies.

Amount in `

Particulars Ram Company Shyam Company -

a

b

a ` b ` c `

d [CS. Executive Dec. 2022]

TAX LAWS (TAX) MCQS

AUTHOR : K.M. BANSAL , ANJALI AGARWAL

PUBLISHER : TAXMANN

DATE OF PUBLICATION : FEBRUARY 2023

EDITION : 7th Edition

ISBN NO : 9789356225909

NO. OF PAGES : 494

BINDING TYPE : PAPERBACK

Rs. 625 USD 38

DESCRIPTION

This book is prepared exclusively for the Executive Level of Company Secretary Examination requirement.

The Present Publication is the 7th Edition for CS-Executive | June/Dec. 2023 Exams. This book is authored by CA (Dr) K.M. Bansal & CA Anjali Agarwal, with the following noteworthy features:

• Strictly as per the New Syllabus of ICSI

• [Coverage] of this book includes

• [Theory & Practical Based MCQs] with Hints for Practical Questions

• [Past Year Examination Questions & Answers], including:

• CS Executive December 2022 Exam

• [Most Updated & Amended] Solutions in this book are provided as per the following:

• [Income Tax Solutions] as per Assessment Year 2023-24

• [GST/Customs Solutions] as per the Latest Applicable Law

• [OMR-Based Examination]

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