Question 1

Concealment of income or false claims to reduce tax liability are cases of ------

Accepted Answer

Concealment of income or making false claims to illegally reduce tax liability is defined as tax evasion, which is a criminal activity.

Question 2

Using the loopholes of law to reduce tax is known as

Accepted Answer

Tax avoidance involves legally exploiting the tax system to reduce tax liabilities, such as through deductions and credits, without breaking the law.

Question 3

------ is the device which satisfies the requirements of the law but not in accordance with the intentions of the law

Accepted Answer

Tax avoidance involves legally arranging one's finances to minimize tax liability, often exploiting loopholes or ambiguities in tax law, thus not aligning with the law's intended spirit.

Question 4

Reducing tax liability, utilizing the deductions, exemptions or reliefs allowed in the Act and Rules is called----

Accepted Answer

Tax planning involves legally reducing tax liability through the effective use of available deductions, exemptions, and reliefs as per the laws and regulations.

Question 5

Compliance of the legal requirements in connection with the tax is the essence of -----

Accepted Answer

Tax management involves complying with legal requirements related to taxes, ensuring that all tax obligations are met accurately and on time.

Question 6

Tax avoidance is ----

Accepted Answer

The answer of Tax avoidance is ----
...

Question 7

Availing tax holiday by a new industrial undertakings in backward areas is a case of

Accepted Answer

Tax planning involves legally arranging one's financial affairs to minimize tax liabilities, and availing tax holidays by new industrial undertakings in backward areas is a legal incentive provided by governments to encourage investment and development in those areas.

Question 8

Compliance with legal formalities and availing tax incentives are cases of

Accepted Answer

The answer of Compliance with legal formalities and availing tax...

Question 9

Return of income must be furnished on or beforethe due date as per a part of-----

Accepted Answer

Tax management involves complying with tax laws, including filing returns on time, to avoid penalties and interest.

Question 10

The total income of a domestic company is taxable at the rate of -------

Accepted Answer

The total income of a domestic company is generally taxable at the rate of 30%. This rate can vary based on specific conditions or changes in the law, but as a standard rate, 30% is commonly applied to the taxable income of domestic companies.

Question 11

The total income of a non domestic company is taxable at the rate of----

Accepted Answer

The total income of a non-domestic company is taxable at the rate of 40% according to the tax regulations for non-domestic companies.

Question 12

Under the Income-tax Act, 1961, which of the following outlays incurred by Sun Ltd. during the previous year ended 31st March, 2019 will not be admissible as deduction while computing its business income

Accepted Answer

All the options listed are not admissible as deductions while computing business income under the Income-tax Act, 1961. Contributions to political parties must be made through non-cash methods to be deductible, interest on loans for income-tax payments is not considered a business expense, and capital expenditure on advertisement is not immediately deductible as it is a capital expense, not a revenue expense.

Question 13

Any corporation by or under any Central, State or Provincial Act or a Government Company as defined in the Companies Act is called -----

Accepted Answer

A Public Sector Company is defined as a company that is owned and operated by the government, either central or state. This includes corporations established by or under any Central, State, or Provincial Act, as well as Government Companies as defined in the Companies Act.

Question 14

Any company which has made the prescribed arrangements for the declaration and payment of dividends within India is called ------

Accepted Answer

A Domestic Company is defined as a company that has made the prescribed arrangements for the declaration and payment of dividends within India. This includes both Indian companies and foreign companies that meet these criteria.

Question 15

A company which is neither an Indian company not has made the prescribed arrangements for the declaration and payment of dividends within India is called -----

Accepted Answer

A company that is not incorporated in India and has not made arrangements for declaring and paying dividends within India is referred to as a Foreign Company.

Question 16

A company in which the public are not substantially interested is closed------

Accepted Answer

A closely held company is one where the shares are held by a small group of individuals or companies, and it is not open to public investment, fitting the description of a company in which the public are not substantially interested.

Question 17

A person carrying not less than----- of the voting power in a company is said to have substantial interest in the company.

Accepted Answer

A person is said to have a substantial interest in a company if they carry not less than 20% of the voting power. This threshold is often used in legal and financial contexts to define significant influence or control over a company's decisions.

Question 18

Section 115JB relates to ----

Accepted Answer

Section 115JB of the Income Tax Act, 1961, deals with the Minimum Alternative Tax (MAT) applicable to companies. It ensures that companies having large profits and declaring dividends to their shareholders but paying minimal or no income tax by taking advantage of exemptions, deductions, incentives, etc., in the Income-tax Act, pay a minimum amount of tax to the government.

Question 19

Under the Income Tax Act, 1961, depreciation on machinery is charged on ………

Accepted Answer

Depreciation on machinery under the Income Tax Act, 1961, is charged on the written down value of the machinery. This method allows for the deduction of a depreciation amount each year based on the asset's value after accounting for depreciation in the previous years, rather than its original purchase price or current market price.

Question 20

If the tax liability of a company is less than 18.5% of its book profits, the company is liable to pay MAT at the rate of ------

Accepted Answer

The Minimum Alternate Tax (MAT) is applicable at 18.5% of book profits plus surcharge (if any) and 4% Health and Education Cess (HEC) when the tax liability is less than 18.5% of book profits.

Quiz 1: Taxation and Corporate Law: Understanding Tax Liability, Compliance, and Deductions