MCQ on Income Tax | Tax Rate & Basic Concept of Income Tax MCQs

Questions

1 The period of 12 months commencing on the rt day of April every year is known as ____________ _

A Financial Year

B Assessment Year

C Previous Year

D Accounting Year

Answer:Assessment Year

2 The charging section of the Income-tax Act, 1961, states that the income earned in a year is taxable in the next year. This is known as ______

A Principle of mutuality

B Previous year rule

C Financial year rule

D None of these.

View Answer

Answer:Previous year rule

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3 Income-tax in India is charged at the rates prescribed by -

A The Finance Act of the assessment year

B The Income-tax Act, 1961

C The Central Board of Direct Taxes

D The Finance Act of the previous year.

View Answer

Answer:The Finance Act of the assessment year

4 A new business was set-up on 1st July, 2018 and trading activity was commenced from 1st September, 2018, the previous year would be the period commencing from

A 1st April, 2018 to 31st March, 2019

B 1st July, 2018 to 31st March, 2019

C 1st September, 2018 to 31st March, 2019

D 1st October, 2018 to 31st March, 2019.

View Answer

Answer:1st April, 2018 to 31st March, 2019

5 According to section 2(24) definition of 'income' is -------

A Inclusive

B Exhaustive

C Exclusive

D Descriptive.

View Answer

Answer:Inclusive

6 'Income' under section 2(24) includes -

(i) The profits and gains of a banking business carried on by a co-operative society with its members.

(ii) Any advance money forfeited in the course of negotiations for transfer of capital asset.

Choose the correct option with reference to the above statements _

A Both (i) and (ii)

B Only (i)

C Only (ii)

D Neither (i) nor (ii).

View Answer

Answer:Both (i) and (ii)

7 Income includes -

A Profits and gains

B Profit in lieu of Salary

C Income from other sources

D All of the above

View Answer

Answer:All of the above

8 Income is divided in ___________ heads of Income.

A 4

B 5

C 6

D 3

View Answer

Answer:5

9 Income includes -

A Profits or Gains

B Capital gains

C Lottery winnings

D All of the above

View Answer

Answer: All of the above

10 The term' income' includes the following types of incomes -

A Legal

B Illegal

C Legal and illegal both

D None of the above

View Answer

Answer:Legal and illegal both

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