Welcome to Income Tax Act - Exemptions MCQs.

DATE : December 16, 2024.

Note : All Questions are compulsory.

Correct Answer : 2 points; Incorrect Answer : - 1 point ( Lets make it tough).

Compensation received from Reliance Ltd by individual(employee of Reliance Ltd) on account of natural disaster is :

Fully Taxable

Fully exempt

Exempt to the certain extent

Maximum amount exempted u/s 10(10B) - Compensation on retrenchment.

Rs. 3,00,000.

Rs. 1,50,000

Rs. 10,00,000

Rs. 5,00,000

Choose appropriate option.

As per section 10(19A) -

Family pension received by the family members of armed personal are exempt..

Annual value of one palace which is in the occupation of an the ex-ruler is exempt.

Pension received by certain awardees / any member of their families.

None of the above

Casual income received by the individual is :

Exempt upto Rs.10,000

Fully taxable

Fully exempt

Amount received under a Life Insurance policy exempt ( if conditions satisfy) u/s -

10(10D)

10(10DD)

10(10C)

80C

Interest received from post office saving bank account is -

(May choose more than one option)

Fully Taxable

Fully exempt

exempt upto Rs. 3,500, in case of individual account

exempt upto Rs. 7,000, in case of joint account

Income from dividend or interest on securities is fully exempt if accrues or arises to a Sikkimese individual.

Determine if following Income of registered political parties :

A) Income from House Property

B) Capital Gains

are taxable or exempt.

A - Taxable, B - Exempt

A - Exempt, B - Exempt

A - Exempt, B - Taxable

A - Taxable, B - Taxable

Salary received by Member of Parliament is taxable.

10.

Income from supply of water or electricity by a local authority outside its jurisdictional area is -

Taxable

Exempt

11.

Receipt of accumulated balance in PPF is -

Taxable

Exempt under section 10(11)

Exempt under section 10(10)

12.

Modi Ltd is a domestic company and Trump Ltd is a foreign company.

Case 1 ) Dividend received by Modi Ltd from Trump Ltd is

Case 2) Dividend received by Trump Ltd from Modi Ltd is

13.

Capital gain arising from compulsory acquisition of urban agricultural land shall be :

Taxable

Exempt u/s 10(34) if certain condition satisfied

Exempt u/s 10(37) if certain condition satisfied

exempt u/s 10(36) if certain condition satisfied

14.

The share of profits from the firm received by an individual as a Partner shall be fully Taxable.

True False

15.

1 ) Scholarship received by a student to meet cost of education is :

2) Student receives scholarship of Rs.25000 but spends only Rs. 13000 to meet the cost of education. The balance Rs. 12,000 is :

1) Fully exempt, 2) Exempt

1) Taxable, 2) Taxable

1) Exempt, 2) Taxable

1) Partially Exempt, 2) Exempt

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Income Tax Act – Exemptions

Compensation received from Reliance Ltd by individual(employee of Reliance Ltd) on account of natural disaster is :

Maximum amount exempted u/s 10(10B) - Compensation on retrenchment.

Choose appropriate option.

As per section 10(19A) -

Casual income received by the individual is :

Amount received under a Life Insurance policy exempt ( if conditions satisfy) u/s -

Interest received from post office saving bank account is -

Income from dividend or interest on securities is fully exempt if accrues or arises to a Sikkimese individual.

Determine if following Income of registered political parties :

are taxable or exempt.

Salary received by Member of Parliament is taxable.

Income from supply of water or electricity by a local authority outside its jurisdictional area is -

Receipt of accumulated balance in PPF is -

Modi Ltd is a domestic company and Trump Ltd is a foreign company.

Capital gain arising from compulsory acquisition of urban agricultural land shall be :

The share of profits from the firm received by an individual as a Partner shall be fully Taxable.

1 ) Scholarship received by a student to meet cost of education is :

2) Student receives scholarship of Rs.25000 but spends only Rs. 13000 to meet the cost of education. The balance Rs. 12,000 is :

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