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B Com Exam  >  B Com Tests  >  Income Tax Laws  >  Test: Heads of the Income - B Com MCQ

Test: Heads of the Income - B Com MCQ


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10 Questions MCQ Test Income Tax Laws - Test: Heads of the Income

Test: Heads of the Income for B Com 2024 is part of Income Tax Laws preparation. The Test: Heads of the Income questions and answers have been prepared according to the B Com exam syllabus.The Test: Heads of the Income MCQs are made for B Com 2024 Exam. Find important definitions, questions, notes, meanings, examples, exercises, MCQs and online tests for Test: Heads of the Income below.
Solutions of Test: Heads of the Income questions in English are available as part of our Income Tax Laws for B Com & Test: Heads of the Income solutions in Hindi for Income Tax Laws course. Download more important topics, notes, lectures and mock test series for B Com Exam by signing up for free. Attempt Test: Heads of the Income | 10 questions in 10 minutes | Mock test for B Com preparation | Free important questions MCQ to study Income Tax Laws for B Com Exam | Download free PDF with solutions
Test: Heads of the Income - Question 1
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What is the primary criterion for an income to be taxed under the head "Salaries"?

Detailed Solution for Test: Heads of the Income - Question 1
For income to be taxed under the head "Salaries," it is essential that a relationship of an employer and employee exists. This relationship should be that of a master and servant, where the employer directs the work and the employee follows the instructions. This criterion ensures that the income is derived from employment and not from other sources.
Test: Heads of the Income - Question 2
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Under which section of the Income Tax Act does the computation of income under the head "Salaries" deal with?

Detailed Solution for Test: Heads of the Income - Question 2
The computation of income under the head "Salaries" is covered under Section 16 of the Income Tax Act. This section provides various deductions and exemptions related to salary income, allowing taxpayers to reduce their tax liability.
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Test: Heads of the Income - Question 3
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When is salary deemed to accrue or arise at a particular place?

Detailed Solution for Test: Heads of the Income - Question 3
Salary is deemed to accrue or arise at a place where services are rendered. This means that the location where the employee performs their duties is the place where the salary is considered to be earned.
Test: Heads of the Income - Question 4
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Which of the following allowances is fully taxable under the head "Salaries"?
Detailed Solution for Test: Heads of the Income - Question 4
City Compensatory Allowance is an example of a fully taxable allowance under the head "Salaries." This allowance is paid to employees working in big cities to compensate for the high cost of living. The amount of this allowance is taxed along with the salary received.
Test: Heads of the Income - Question 5
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What is the primary criterion for an income to be taxed under the head "Income from Other Sources"?
Detailed Solution for Test: Heads of the Income - Question 5
Income is taxed under the head "Income from Other Sources" when it is not chargeable under any other head of income, such as salary, house property, business or profession, and capital gains. This category covers various types of income that do not fall under the other heads.
Test: Heads of the Income - Question 6
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For how many years does an asset need to be held to be considered a long-term capital asset?
Detailed Solution for Test: Heads of the Income - Question 6
An asset needs to be held for more than 3 years to be considered a long-term capital asset. If sold after this holding period, the gains arising from the sale will be taxed at concessional rates for long-term capital gains.
Test: Heads of the Income - Question 7
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Which type of income is exempted from tax under the head "Income from Other Sources"?
Detailed Solution for Test: Heads of the Income - Question 7

Agricultural income is exempt from tax under the Income Tax Act, and it is not considered under the head "Income from Other Sources." This is because agricultural income is specifically exempted from tax under Section 10(1) of the Income Tax Act. Other forms of income, such as interest on bank deposits and dividends from Indian companies, are taxable under current tax law

Test: Heads of the Income - Question 8
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What happens if the consideration for the transfer of a property is less than the stamp duty value?
Detailed Solution for Test: Heads of the Income - Question 8
If the consideration for the transfer of a property is less than the stamp duty value, the stamp duty value is deemed to be the full value of consideration for the purpose of computing income under the head "Income from House Property."
Test: Heads of the Income - Question 9
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What is the primary criterion for an income to be treated as exempt under the head "Income from House Property"?
Detailed Solution for Test: Heads of the Income - Question 9
An income is treated as exempt under the head "Income from House Property" when the property is self-occupied. This means that if you live in the property yourself, the income from that property is not taxable under this head.
Test: Heads of the Income - Question 10
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Which type of income is fully taxable under the head "Income from Other Sources"?
Detailed Solution for Test: Heads of the Income - Question 10
Income from winnings from lotteries, crossword puzzles, races, card games, game shows, gambling, or betting is fully taxable under the head "Income from Other Sources." This includes income from various forms of games of chance.
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