Home/FBR/Income Tax Ordinance 2001 Pakistan Test Online

Income Tax Ordinance 2001 Pakistan Test Online

Mustansar KhanLast Updated: July 8, 2025

Income Tax Ordinance 2001 Pakistan Test Online

Income Tax Ordinance 2001 Pakistan Test

Total Questions:	38
Time Allowed:	20 Minutes
Total Marks:	38
How to Attempt Test:	Please choose the right Option in MCQ-type question.
Test Helpful For:	FBR Sub Inspector Test Customs Inspector Test FBR Interviews FBR Sepoy Test Preparation for Customs and Tax Related Questions

Please wait...

Page 1 of 2

1. Which of the following would be considered a "business expense" that can be deducted under the Income Tax Ordinance, 2001?

Office rent and utilities

Income from investments

Personal clothing expenses

Personal grocery bills

2. What is the "assessment year" under the Income Tax Ordinance, 2001?

The year following the income year

The year in which the tax return is filed

The year in which the tax payment is made

The same year as the income year

3. Which of the following taxes is imposed under the Income Tax Ordinance, 2001?

Property tax

Income tax

Customs duties

Sales tax

4. Which of the following is the main purpose of the Income Tax Ordinance, 2001?

To enforce customs duties

To impose and collect income tax from individuals and businesses

To provide exemptions on imports

To regulate the sales tax system

5. Under the Income Tax Ordinance, 2001, what is the consequence of providing false information on tax returns?

Reduction in tax liabilities

No penalty, just correction of records

A fine, along with possible imprisonment

Tax refund will be issued

6. What is the purpose of "tax credits" under the Income Tax Ordinance, 2001?

To provide a refund of taxes paid in the previous year

To eliminate taxes for low-income individuals

To allow taxpayers to reduce their taxable income

To reduce the total amount of taxes payable

7. What is the maximum tax rate for individuals under the Income Tax Ordinance, 2001 in Pakistan?

40%

15%

35%

25%

8. What does the "tax year" mean under the Income Tax Ordinance, 2001?

A calendar year from January 1 to December 31

A 6-month period for businesses

A 12-month period from the date of registration

A fiscal year starting from July 1 and ending on June 30

9. What is the term "tax avoidance" in the context of the Income Tax Ordinance, 2001?

Hiding income to reduce tax liability

Not paying taxes at all

Using illegal methods to evade tax payments

Minimizing tax liability through legal means such as exemptions and deductions

10. What is the "income year" under the Income Tax Ordinance, 2001?

A calendar year from January 1st to December 31st

A 12-month period beginning on July 1st

A 12-month period that ends on December 31st

A fiscal year from July 1st to June 30th

11. Which of the following entities is responsible for implementing the Income Tax Ordinance, 2001 in Pakistan?

State Bank of Pakistan

Ministry of Commerce

Federal Board of Revenue (FBR)

Pakistan Stock Exchange

12. What is the "minimum tax" under the Income Tax Ordinance, 2001?

A fixed amount of tax levied regardless of income

The tax paid by businesses with no income

The lowest tax rate applicable to small businesses

The tax rate for salaried individuals

13. Which of the following is a "corporate tax" under the Income Tax Ordinance, 2001?

A tax on bank deposits

A tax on individual salaries

A tax on the profit earned by companies

A tax on the sale of goods

14. What is the "final tax" regime under the Income Tax Ordinance, 2001?

A tax system that applies to international transactions

A system where tax liabilities are paid annually

A tax only applicable to salaried individuals

A system where tax is deducted at the source and considered final payment

15. Which of the following is considered an exempt income under the Income Tax Ordinance, 2001?

Salary

Dividend income

Income from agriculture (subject to conditions)

Profit from business activities

16. Which of the following is a "penalty" under the Income Tax Ordinance, 2001 for failure to file tax returns?

Tax rebate

A fine and possible imprisonment

Suspension of business activities

Payment of late fees

17. What does the term "advance tax" refer to under the Income Tax Ordinance, 2001?

A prepayment of taxes for the following tax year

Tax collected by employers from employees' salaries

Tax paid after filing tax returns

Tax paid on goods and services

18. Which of the following is considered taxable income under the Income Tax Ordinance, 2001?

Income from agricultural activities

Interest earned on savings accounts

All of the above

Income from a business or profession

19. Which of the following is NOT a deduction available under the Income Tax Ordinance, 2001?

Donations to charitable organizations

Contributions to a recognized retirement plan

Rent paid for personal use

Medical expenses

20. What is "advance tax payment" under the Income Tax Ordinance, 2001?

Tax paid in advance by businesses or individuals based on estimated income

Tax paid at the time of filing returns

Tax that is withheld by the employer from an employee’s salary

Tax paid for imports

21. What is the term "taxable person" under the Income Tax Ordinance, 2001?

A person or entity that is liable to pay taxes under the Ordinance

A person who is exempt from paying taxes

A person who receives income from abroad

A person whose income is below the minimum taxable threshold

22. What is the definition of "gross income" under the Income Tax Ordinance, 2001?

Income from foreign sources only

Total income before any deductions or exemptions

Income derived solely from investments

Net income after expenses

23. What is the general tax rate applied to corporate income under the Income Tax Ordinance, 2001?

30%

35%

25%

20%

24. Which of the following is an example of "capital gains" under the Income Tax Ordinance, 2001?

Interest earned on savings accounts

Income from salaries

Profit from the sale of shares or real estate

Business profits

25. Which of the following is a key feature of the "tax withholding" system under the Income Tax Ordinance, 2001?

Employers or payers withhold a portion of the income and remit it to the tax authorities

Tax is not deducted for personal income

Tax is only deducted for business profits

Tax is paid directly to the tax authorities by the taxpayer

Page 2 of 2

26. Which of the following is considered a tax credit under the Income Tax Ordinance, 2001?

Tax on agricultural income

Tax paid on foreign income

Refund for excess sales tax paid

Credit for tax paid on dividends

27. What is the term "taxable year" in the context of the Income Tax Ordinance, 2001?

The year in which income is assessed

The year during which income is earned and taxed

The year when taxes are paid

The year when the business fiscal year ends

28. Which of the following is the "final tax regime" in the context of the Income Tax Ordinance, 2001?

A tax applied only to businesses with large profits

A system where tax is paid in full at the source and no further tax filing is required

A system that applies only to salaried individuals

A system where tax is calculated based on actual income

29. Which of the following forms must be filed annually under the Income Tax Ordinance, 2001 for individual taxpayers?

Excise Duty Return

Income Tax Return

Business Tax Registration

Sales Tax Return

30. Which of the following would NOT be eligible for a tax deduction under the Income Tax Ordinance, 2001?

Rent paid for a business office

Interest paid on a business loan

Business-related travel expenses

Personal grocery expenses

31. What does the "taxable income" refer to under the Income Tax Ordinance, 2001?

Total income of an individual

Total income minus allowable deductions and exemptions

Gross income from business only

Net income after applying tax rates

32. Under the Income Tax Ordinance, 2001, which of the following is considered a "non-resident" taxpayer?

An individual whose income is solely derived from Pakistan

An individual who is a government employee

An individual who resides in Pakistan for more than 183 days in a tax year

An individual who resides outside Pakistan for more than 183 days

33. Which of the following is eligible for tax exemption under the Income Tax Ordinance, 2001?

Income from government bonds

Income from foreign investments

Income from agriculture (subject to conditions)

Salary from a private company

34. Which of the following is a deduction allowed under the Income Tax Ordinance, 2001 for individual taxpayers?

Business profits

Health insurance premiums

Rental income

Personal travel expenses

35. Under the Income Tax Ordinance, 2001, how is a business's taxable income calculated?

By applying a flat tax rate on total sales

By subtracting deductible business expenses from gross revenue

By determining total profits and applying tax exemptions

By subtracting personal expenses from business revenues

36. Which of the following is a "non-taxable income" under the Income Tax Ordinance, 2001?

Agricultural income

Income from salaries

Rental income from property

Business profits

37. What is the function of a "tax audit" under the Income Tax Ordinance, 2001?

To identify illegal tax evasion methods

To verify the financial statements and income tax filings of a taxpayer

To file income tax returns on behalf of taxpayers

To calculate the tax refund for businesses

38. Which of the following is a tax-free allowance under the Income Tax Ordinance, 2001?

Travel allowances for business

Housing allowance

Tax credits for children

Education allowance for children

You Can Learn and Gain more Knowledge through our Online Quiz and Testing system Just Search your desired Preparation subject at Gotest.

Basic Concepts of Taxation Test Online
Federal Board of Revenue (FBR) Function and Role Test Online
Pakistan Customs Role, Functions and Laws Test Online
Sales Tax and Federal Excise Duty Basic Concept Test Online
Key Economic Terms Test Online (Basic Economic Indicators)
Fiscal Policy of Pakistan Test Online
Tax Administration and Reforms in Pakistan Test Online
Sales Tax Act 1990 Pakistan Test Online
Federal Excise Act 2005 Pakistan Test Online
Basic Concepts of Auditing and Accounting Test Online

Mustansar KhanLast Updated: July 8, 2025

Income Tax Ordinance 2001 Pakistan Test Online

Income Tax Ordinance 2001 Pakistan Test Online

Income Tax Ordinance 2001 Pakistan Test

Related Posts

Mustansar Khan

Leave a Reply Cancel reply