CS Executive Tax Laws MCQs on Salaries asked by ICSI in Previous Exams


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Deep Gyan joins a service in the grade of ₹ 15,600 – 39,100 plus grade pay of ₹ 6,000 on 1.8.2021. He also gets a dearness allowance @ 107% of his salary. His tax liability for A.Y. 2022 -2023 will be:

Deep Gyan joins service on 1st April, 2017 in the grade of ₹ 15,000-1,000- 18,000-2,000-26,000. He shall be paying tax for the year ended on 31st March, 2022 on the total salary of:

What will be the amount of gross salary which shall be required to be declared in the return of income to be filed for the previous year 2021-22 by Deep Gyan, who joined services as Manager Accounts on the salary of ₹ 17,000 p.m. in Deep Gyan Ltd. on 1st April 2019 in the grade of 15,000 – 2000 – 19,000 – 3000 – 28,000?

A Central Government Officer received during the year 2021-22 salary excluding all allowances of ₹ 9,00,000 and amount of entertainment allowance of ₹ 12,000 @ ₹ 1,000 p.m. The maximum amount of entertainment allowance so received by him being exempt under section 16(ii) of the Act is:

Deep Gyan, a handicapped employee receives ₹ 3,000 p.m. as a transport allowance from his employer. His actual expenditure on transport is ₹ 2,000 p.m. The amount of transport allowance taxable under the head income from salaries will be—

Deep Gyan, employed in Deep Gyan Ltd., was eligible for a transport allowance of ₹ 2,000 per month to meet his travel expenses from residence to office. He actually incurred ₹ 1,200 per month towards travel. The amount of travel allowance chargeable to tax as perquisite would be:

Mr. Deep Gyan is employed in Deep Gyan Transports as a cabin driver. He is paid ₹ 15,000 every month in the whole of the previous year 2021-22 as an allowance for meeting his personal expenditure in the course of running the goods vehicle. Mr. A does not receive any other amount by way of the daily allowance. The amount of allowance eligible for the exemption is:

Children education allowance received by an employee from his employer is ₹ 80 per month per child for 3 children. Taxable education allowance will be

Deep Gyan is an employee of Soon Public School. His daughter, Nannu, is studying in the said school at concessional fees of ₹ 600 p.m. (Actual fee: ₹ 4,000 p.m.). Amount taxable in the hands of Deep Gyan will be

Mr. Deep Gyan employed in Nannu Ltd. was permitted to admit his only son to the school run by the employer. No fee was charged on such education provided to the son of Mr. Deep Gyan. The cost of such education for other children is ₹ 1,800 per month. The perquisite value of free education in the hands of Mr. Deep Gyan would be:

Deep Gyan is receiving ₹ 10,000 as a medical allowance from his employer. Out of this, he spends ₹ 5,000 on his own medical treatment, ₹ 2,000 on the medical treatment of his dependent wife, and another ₹ 3,000 for the medical treatment of his major son who is not dependent on him. The amount of medical allowance taxable in his hand is:

Mr. Deep Gyan is employed in, Neetu Institute, Delhi. He is eligible for ₹ 24,000 as an allowance for the year towards academic and research work. The amount of academic and research allowance chargeable to tax is:

Mr. Deep Gyan employed in Nannu Co. Ltd. received ₹ 10,000 per month as house rent allowance in the year 2021-22. His total salary is ₹ 4 lakhs consisting of Basic Pay + DA. He paid rent of ₹ 8,000 per month. How much of HRA is exempt from tax?

Deep Gyan is employed in Babu Ltd., Delhi. He is paid a house rent allowance of ₹ 9,000 per month in the financial year 2021-22. His salary for the purpose of computation of house rent allowance exemption may be taken as ₹ 20,000 per month. Deep Gyan pays actual rent of ₹ 10,000 per month. How much of the house rent allowance is tax-free?

Deep Gyan Ltd. transfers a Honda City car to its employee after using it for 4 years and 10 months, for ₹ 2,10,000. The original cost of the car is Rs. 10,00,000. The value of taxable perquisite in the hands of employee is:

A company acquired a motor car for ₹ 8 lakh on 30th June 2020. It sold the said motor car to its employee for ₹ 6 lakh on 10th June 2021. The company claimed depreciation @ 15% for the year ended 31st March 2022. The perquisite value in the hands of employee on sale of motor car would be –

The company has provided a laptop worth ₹ 50,000 to his employee for official as well as personal purposes. The taxable amount of perquisites will be:

During the previous year 2021-22, Mr. Deep Gyan received a watch worth ₹ 20,000 from his employer. The taxable value of the watch will be:

Deep Gyan took an interest-free loan of ₹ 15,000 from Babu Ltd. (the employer). Assuming that the market rate of interest on the similar loan is 10%, the taxable value of the prerequisite in the hands of Deep Gyan will be:

Ms. Janhvi is provided with an interest loan by her employer for the purchase of a house. The value of the perquisite shall be:

Which of the following is not correct about the approved superannuation fund?

Kapil gets a salary of 712,000 p.m. and is provided with rent-free unfurnished accommodation at Pune (population 31 lakh). House is owned by the employer, the fair rental value of which is ₹ 1,400 p.m. House was provided with effect from 1st July 2020. Value of the prerequisite of rent-free accommodation will be:

Mr. Arjun employed in KL (P) Ltd. at Mumbai was provided rent-free accommodation by the employer who owned such accommodation. The salary income of Mr. Arjun for the purpose of computing the perquisite value is ₹ 8 lakhs. The perquisite value of rent-free accommodation in the hands of Mr. Arjun is:

Ramesh, an employee of Gauri & Co. of Delhi, received the following payments during the previous year ended 31st March 2021: Basic salary: ₹ 2,40,000 Dearness allowance: 40% of basic salary (40% forming part of salary). Rent-free unfurnished accommodation provided by the employer for which rent paid by employer being ₹ 50,000. The value of taxable perquisite in the hands of Ramesh will be:

Satish is employed as chief engineer in Gama Ltd., Chennai w.e.f. 1st April 2020 for a consolidated salary of ₹ 60,000 per month. He is provided with rent-free unfurnished accommodation owned by the employer from 1st July 2019 onwards. The value of taxable perquisite is

Mr. Balan is employed in SS Ltd at Madurai. He is provided with rent-free accommodation owned by the employer. The percentage of salary to be adopted for the purpose of valuation of perquisite would be:

The employee is provided with furniture costing ₹ 1,50,000 along with house w.e./. 1.7.2020. The value of the furniture to be included in the valuation of the unfurnished house shall be:

Mr. Gupta is given a motor car with chauffeur by the employer which is used for both official and personal purposes. The entire running expenses of the car amounting to ₹ 64,800 were met by the employer in the previous year 2020-21. The cubic capacity of the engine of the motor car exceeds 1.6 liters. The perquisite value of motor car taxable in the hands of Mr. Gupta is:

Ravi employed in Cotton India Ltd. as an accounts manager. The employer paid ₹ 1,60,000 as a contribution to the approved superannuation fund to benefit the employee, Ravi. The amount of such contribution liable to tax as perquisite in the hands of Mr. Ravi is:

During the previous year, the employee was reimbursed ₹ 24,000 as medical expenses incurred by him which includes ₹ 7,000 spent in a Government hospital. The taxable prerequisite, in this case, shall be:

An employee of a public limited company received ₹ 3,00,000 as encashment of leave salary at the time of retirement. He has 18 months left to his credit at the time of retirement and his average salary for the last 10 months is ₹ 24,000. The taxable amount of leave encashment would be:

The maximum amount eligible for exemption in respect of encashment of earned leave on retirement is:

Deep Gyan is employed in a factory at a salary of ₹ 2,400 per month. He also gets a dearness allowance @ ₹ 600 per month and a bonus of @ ₹ 200 per month. He retired on 31st December 2021 and received ₹ 75,000 as gratuity under the Payment of Gratuity Act, 1972 after serving 31 years and 4 months in that factory. The amount of gratuity exempt under the Income-tax Act, 1961 will be

CS Executive Tax Laws MCQs asked in Dec. 2014.

Mr. Ashwin retired on 31.10.2020 after rendering 35 years of service in PLN & Co. Ltd. He received a gratuity of ₹ 18 lakhs. He is governed by the Payment of Gratuity Act, 1972. The monetary limit eligible for the exemption is:

Mr. Vijay employed in ABC Ltd opted for voluntary retirement and received ₹ 22 lakh by way of gratuity. The Payment of Gratuity Act, 1972 is applicable in his case. The monetary limit for exemption under Section 10(10) is:

The maximum amount of gratuity exempt and the maximum amount of leave encashment exempt under the Act respectively are:

Mohan retired from Y & Company Ltd. on 31.8.2020 after rendering services for 31 years and 7 months. He was paid ₹ 11 lakh as gratuity under the Payment of Gratuity Act, 1972. His last drawn salary was ₹ 52,000. How much of the amount of gratuity would be exempt?

Deep Gyan is entitled to get a pension of ₹ 6,000 per month from a private company. He gets 60% of the pension commuted and receives ₹ 3,60,000. He also receives ₹ 2,00,000 as gratuity from the same employer. Taxable portion of commuted value of pension will be:

CS Executive Tax Laws MCQs asked in Dec. 2014.

Anil is employed in a company with an annual salary of ₹ 8,60,000 (computed). The company paid income-tax of ₹ 37,000 on his non- monetary perquisites. He paid ₹ 1,20,000 to recognized provident fund during the year 2020-21. His total income would be:

Rohan retires from private service on 30th April 2020 and his pension has been fixed at ₹ 1,500 p.m. He gets 1/2 of his pension commuted during January 2020 and receives ₹ 75,000. He also gets ₹ 60,000 as gratuity. The total pension taxable including commuted value will be

An employee of a company, who was entitled for a gratuity of ₹ 8,00,000, also received ₹ 12,00,000by commuting 40% of his pension. The taxable amount of commuted pension is:

John, who recently retired from service of a company on 31st March 2021 is eligible for a monthly pension of ₹ 20,000. He has received gratuity on his retirement also. He wants to commute 50% of his pension for ₹ 6.00 lakh. How much amount of this commuted pension shall be subject to tax in AY 2021-2022?

Employer’s contribution to Recognized Provident Fund (RPF) in excess of 12% of salary income of an employee shall be treated as:

Ashwin Co. Ltd. contributed 15% of the salary of the employee Virat towards the recognized provident fund. Amount liable to tax as perquisite in the hands of Virat would be of contribution.

Mrs. Meena retired from service with Sky Ltd. on 31st January 2021. She received the following amounts from the unrecognized provident fund: (i) Own contribution ₹ 1,50,000 (ii) Interest on own contri- ₹ 21,000 bution (iii) Employer’s contribu- ₹ 1,10,000 tion (iv) Interest on employer’s ₹ 15,000 contribution How much of the receipt is chargeable to tax as income from salary?

Interest credited to the statutory provident fund shall be:

When interest on employee’s own contribution from the unrecognized provident fund is received, it is:

Total income of Nand Kishore under the head ‘Salary’ for the financial year 2020-21 of whose basic salary and DA per month was of ₹ 40,000 and ₹ 3,000 respectively and who was also paid leave salary of ₹ 6,000 and ₹ 1,000 of professional tax by the employer shall be

An assessee is not eligible to claim any relief under section 89 of Income-tax Act, 1961, when he is in receipt of income as arrears or in advance during the previous year from his employer:

Allowances and perquisites allowed to an employee for services rendered outside India are tax-free in case of –

Govt, of India paid a salary of ₹ 5 lakh and allowances and perquisites valued at ₹ 2.20 lakh to a person who is a citizen of India for the services rendered by him outside India for 5 months during the previous year. His total income chargeable to tax would be:

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