Income Tax Ordinance 2001 Pakistan Test Online

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Question 1

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

Answer

Personal grocery bills

Answer

Office rent and utilities

Answer

Income from investments

Answer

Personal clothing expenses

Question 2

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

Answer

Rent paid for a business office

Answer

Business-related travel expenses

Answer

Interest paid on a business loan

Answer

Personal grocery expenses

Question 3

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

Answer

Profit from business activities

Answer

Income from agriculture (subject to conditions)

Answer

Dividend income

Question 4

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

Answer

Sales Tax Return

Answer

Business Tax Registration

Answer

Income Tax Return

Answer

Excise Duty Return

Question 5

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

Answer

By applying a flat tax rate on total sales

Answer

By subtracting deductible business expenses from gross revenue

Answer

By subtracting personal expenses from business revenues

Answer

By determining total profits and applying tax exemptions

Question 6

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

Answer

To file income tax returns on behalf of taxpayers

Answer

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

Answer

To calculate the tax refund for businesses

Answer

To identify illegal tax evasion methods

Question 7

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

Answer

A calendar year from January 1st to December 31st

Answer

A fiscal year from July 1st to June 30th

Answer

A 12-month period beginning on July 1st

Answer

A 12-month period that ends on December 31st

Question 8

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

Answer

A fine, along with possible imprisonment

Answer

Tax refund will be issued

Answer

Reduction in tax liabilities

Answer

No penalty, just correction of records

Question 9

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

Answer

State Bank of Pakistan

Answer

Pakistan Stock Exchange

Answer

Federal Board of Revenue (FBR)

Answer

Ministry of Commerce

Question 10

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

Answer

An individual whose income is solely derived from Pakistan

Answer

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

Answer

An individual who is a government employee

Answer

An individual who resides outside Pakistan for more than 183 days

Question 11

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

Answer

Tax paid at the time of filing returns

Answer

Tax paid for imports

Answer

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

Answer

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

Question 12

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

Answer

Income tax

Answer

Property tax

Answer

Customs duties

Question 13

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

Answer

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

Answer

A 12-month period from the date of registration

Answer

A calendar year from January 1 to December 31

Answer

A 6-month period for businesses

Question 14

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

Question 15

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

Answer

Tax rebate

Answer

Payment of late fees

Answer

Suspension of business activities

Answer

A fine and possible imprisonment

Question 16

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

Answer

Gross income from business only

Answer

Total income minus allowable deductions and exemptions

Answer

Net income after applying tax rates

Answer

Total income of an individual

Question 17

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

Answer

Tax credits for children

Answer

Housing allowance

Answer

Education allowance for children

Answer

Travel allowances for business

Question 18

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

Answer

Net income after expenses

Answer

Income derived solely from investments

Answer

Total income before any deductions or exemptions

Answer

Income from foreign sources only

Question 19

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

Answer

A tax only applicable to salaried individuals

Answer

A tax system that applies to international transactions

Answer

A system where tax liabilities are paid annually

Answer

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

Question 20

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

Answer

Income from agriculture (subject to conditions)

Answer

Income from government bonds

Answer

Salary from a private company

Answer

Income from foreign investments

Question 21

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

Answer

The tax paid by businesses with no income

Answer

The tax rate for salaried individuals

Answer

The lowest tax rate applicable to small businesses

Answer

A fixed amount of tax levied regardless of income

Question 22

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

Answer

To eliminate taxes for low-income individuals

Answer

To provide a refund of taxes paid in the previous year

Answer

To allow taxpayers to reduce their taxable income

Answer

To reduce the total amount of taxes payable

Question 23

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

Answer

Tax paid on foreign income

Answer

Refund for excess sales tax paid

Answer

Tax on agricultural income

Answer

Credit for tax paid on dividends

Question 24

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

Answer

A tax on bank deposits

Answer

A tax on the sale of goods

Answer

A tax on individual salaries

Answer

A tax on the profit earned by companies

Question 25

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

Answer

A person who receives income from abroad

Answer

A person whose income is below the minimum taxable threshold

Answer

A person who is exempt from paying taxes

Answer

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

Question 26

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

Answer

Contributions to a recognized retirement plan

Answer

Rent paid for personal use

Answer

Donations to charitable organizations

Answer

Medical expenses

Question 27

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

Answer

The year in which the tax payment is made

Answer

The same year as the income year

Answer

The year following the income year

Answer

The year in which the tax return is filed

Question 28

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

Answer

Minimizing tax liability through legal means such as exemptions and deductions

Answer

Hiding income to reduce tax liability

Answer

Using illegal methods to evade tax payments

Answer

Not paying taxes at all

Question 29

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

Answer

Interest earned on savings accounts

Answer

Income from a business or profession

Answer

All of the above

Answer

Income from agricultural activities

Question 30

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

Answer

Tax paid on goods and services

Answer

Tax collected by employers from employees' salaries

Answer

A prepayment of taxes for the following tax year

Answer

Tax paid after filing tax returns

Question 31

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

Answer

Personal travel expenses

Answer

Business profits

Answer

Rental income

Answer

Health insurance premiums

Question 32

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

Answer

A system that applies only to salaried individuals

Answer

A system where tax is calculated based on actual income

Answer

A tax applied only to businesses with large profits

Answer

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

Question 33

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

Answer

To provide exemptions on imports

Answer

To impose and collect income tax from individuals and businesses

Answer

To enforce customs duties

Answer

To regulate the sales tax system

Question 34

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

Question 35

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

Answer

Income from salaries

Answer

Rental income from property

Answer

Agricultural income

Answer

Business profits

Question 36

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

Answer

Tax is not deducted for personal income

Answer

Tax is paid directly to the tax authorities by the taxpayer

Answer

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

Answer

Tax is only deducted for business profits

Question 37

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

Answer

The year in which income is assessed

Answer

The year when taxes are paid

Answer

The year during which income is earned and taxed

Answer

The year when the business fiscal year ends

Question 38

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

Answer

Business profits

Answer

Interest earned on savings accounts

Answer

Income from salaries

Answer

Profit from the sale of shares or real estate

Question 39

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Total Questions:	38
Time Allowed:	20 Minutes
Total Marks:	38
How to Attempt Test:	Please choose the right Option in MCQ-type question.
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Income Tax Ordinance 2001 Pakistan Test Online

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Income Tax Ordinance 2001 Pakistan Test Online

Income Tax Ordinance 2001 Pakistan Test

Study Plan for Income Tax Ordinance 2001 Pakistan Test Online

How to Use GoTest for Preparation:

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