TDS, advance tax, e-filing of returns - Question Bank

1. Which of the following can be considered a tax evasion technique rather than tax planning?
A) Investing in tax-saving instruments like PPF or ELSS
B) Claiming deductions for eligible expenses
C) Understating income or inflating expenses
D) Choosing the optimal tax regime
2. What does the term 'Tax Planning' generally refer to?
A) Concealing income to reduce tax liability
B) Utilizing tax laws to minimize tax liability legally
C) Paying tax on time without any strategy
D) Avoiding tax altogether
3. What is the due date for e-filing income tax returns for taxpayers covered under presumptive taxation schemes (like Section 44AD, 44ADA) or those requiring tax audit?
A) July 31st
B) September 30th
C) October 31st
D) November 30th
4. Which of the following is a presumptive taxation scheme for small businesses?
A) Section 44AD
B) Section 44AB
C) Section 44ADA
D) Section 44AE
5. What is the definition of 'Assessment Year' in the context of Income Tax filing?
A) The year in which income is earned
B) The year immediately following the financial year, during which tax is levied on income earned in the previous year
C) A 12-month period chosen by the taxpayer
D) The year in which the tax return is filed
6. What is the consequence of non-deduction or non-payment of TDS by the deductor?
A) The deductor can claim the expense as a deduction
B) The expense is disallowed as a deduction under Section 40(a)(iib)
C) The recipient is liable to pay the TDS
D) The deductor gets a tax credit for the TDS amount
7. Which section allows for a lower or nil TDS deduction certificate to be obtained by the assessee?
A) Section 197
B) Section 198
C) Section 199
D) Section 200
8. What is the rate of interest for delay in payment of TDS under Section 234Q?
A) 1% per month
B) 1.5% per month
C) 0.5% per month
D) 1.25% per month
9. If a taxpayer fails to pay TDS on time, interest is levied under which section?
A) Section 234A
B) Section 234B
C) Section 234C
D) Section 234Q
10. What is the due date for furnishing TDS statements (Form 24Q, 26Q, etc.) for the last quarter of the financial year?
A) April 30th
B) May 31st
C) June 30th
D) July 31st
11. Form 26QB is related to:
A) TDS on salary
B) TDS on rent
C) TDS on purchase of property
D) TDS on winning lottery
12. Which form is used for reporting TDS by the deductor to the government?
A) Form 24Q
B) Form 26QB
C) Form 27Q
D) Form 27EQ
13. What is the standard TDS rate on interest paid by a bank on fixed deposits to a resident individual?
A) 5%
B) 10%
C) 15%
D) 20%
14. Which section deals with TDS on fees for professional or technical services?
A) Section 194J
B) Section 194H
C) Section 194C
D) Section 194I
15. What is the threshold limit for TDS on payments to contractors under Section 194C?
A) Rs. 30,000 for single payment, Rs. 1,00,000 aggregate in a year
B) Rs. 50,000 for single payment, Rs. 2,00,000 aggregate in a year
C) Rs. 10,000 for single payment, Rs. 50,000 aggregate in a year
D) No threshold limit
16. TDS on commission or brokerage is covered under which section?
A) Section 194H
B) Section 194G
C) Section 194A
D) Section 194B
17. What is the TDS rate on payments made to non-residents for technical services, if PAN is not available?
A) 10%
B) 20%
C) 30%
D) 50%
18. Which of the following is NOT a benefit of e-filing?
A) Speed and efficiency
B) Reduced errors
C) Increased privacy concerns
D) Lower processing time
19. What is the deadline for furnishing a belated income tax return under Section 139(4)?
A) July 31st of the assessment year
B) September 30th of the assessment year
C) December 31st of the assessment year
D) Before the end of the assessment year (March 31st)
20. What is the penalty amount under Section 234F if the return is filed after the due date but before December 31st of the assessment year?
A) Rs. 1,000
B) Rs. 5,000
C) Rs. 10,000
D) Rs. 1,000 for income below Rs. 5 lakh, Rs. 5,000 otherwise
21. Section 234F of the Income Tax Act deals with:
A) Interest for default in payment of Advance Tax
B) Interest for delay in furnishing return of income
C) Penalty for default in furnishing return of income
D) TDS on salary
22. What is the penalty for not filing the income tax return by the due date?
A) No penalty
B) A fine of Rs. 1,000
C) Interest and penalty under Section 234F
D) Cancellation of PAN
23. Who can use ITR-4 (Sugam) for e-filing?
A) Individuals, HUFs, and Firms with total income up to Rs. 50 lakh and having income from business and profession computed under presumptive taxation provisions
B) Individuals with income only from salary
C) Individuals with capital gains exceeding Rs. 10 lakh
D) Companies and LLPs
24. What is Form 26AS?
A) A form for claiming tax exemptions
B) A consolidated tax statement showing tax deducted at source, tax collected at source, advance tax, and self-assessment tax paid
C) A form for applying for a new PAN card
D) A form for TDS refund
25. Which of the following is a method of verifying an e-filed income tax return?
A) Sending a physical acknowledgement by post
B) EVC (Electronic Verification Code) using Aadhaar OTP
C) Verbal confirmation over the phone
D) Attending an income tax office interview
26. What is the purpose of 'Verify' option after e-filing the return?
A) To download the return
B) To confirm the authenticity of the return and make it legally valid
C) To pay the tax due
D) To modify the return
27. What is the due date for e-filing income tax returns for individuals (not requiring tax audit)?
A) July 31st of the assessment year
B) September 30th of the assessment year
C) December 31st of the assessment year
D) March 31st of the assessment year
28. Which form is generally used for e-filing by individuals having income from salary and other sources (not business/profession)?
A) ITR-1 (Sahaj)
B) ITR-2
C) ITR-3
D) ITR-4 (Sugam)
29. What is PAN?
A) Permanent Account Number
B) Personal Asset Number
C) Payment Authorization Number
D) Property Allocation Number
30. Which is the official portal for e-filing income tax returns in India?
A) incometaxindia.gov.in
B) incometax.gov.in
C) gst.gov.in
D) tin-nsdl.com
31. What does e-filing of income tax returns mean?
A) Filing the return through email
B) Filing the return electronically through the internet
C) Filing the return using a physical computer
D) Filing the return via a mobile app only
32. What is the primary purpose of Advance Tax?
A) To provide liquidity to the government throughout the year
B) To penalize taxpayers for high income
C) To simplify tax filing
D) To reduce the tax burden on small taxpayers
33. If a taxpayer estimates lower income and pays Advance Tax accordingly, but the actual income is higher, what happens?
A) No action is taken
B) Interest is levied on the shortfall
C) The tax return is rejected
D) A penalty is imposed
34. Which income is generally NOT subject to Advance Tax?
A) Income from Business or Profession
B) Capital Gains
C) Income from Salaries
D) Income from House Property
35. Interest for default in payment of Advance Tax is levied at what rate?
A) 1% per month or part of a month
B) 1.5% per month or part of a month
C) 0.75% per month or part of a month
D) As determined by the assessing officer
36. What is the penalty for non-payment or short payment of Advance Tax?
A) A fixed fine of Rs. 5,000
B) Interest under Section 234B and 234C
C) Imprisonment
D) Cancellation of PAN card
37. The first installment of Advance Tax is payable on or before which date?
A) June 15
B) September 15
C) December 15
D) March 15
38. What are the due dates for payment of Advance Tax installments?
A) June 15, September 15, December 15, March 15
B) July 15, October 15, January 15
C) April 1, July 1, October 1, January 1
D) Quarterly payments on the last day of each quarter
39. Who is liable to pay Advance Tax?
A) Every taxpayer
B) Only salaried individuals
C) Taxpayers whose estimated tax liability for the year exceeds Rs. 10,000
D) Companies only
40. What is Advance Tax?
A) Tax paid in advance for the next financial year
B) Tax paid in installments during the financial year on income other than salary
C) Tax paid on income earned before the financial year ends
D) A tax rebate for early filers
41. Which section deals with TDS on interest other than interest on securities?
A) Section 194C
B) Section 194A
C) Section 194J
D) Section 194I
42. TDS is applicable on payment of rent exceeding Rs. _______ per annum to a resident landlord.
A) 50,000
B) 1,00,000
C) 1,50,000
D) 2,00,000
43. What is the threshold limit for TDS on salary payments?
A) Rs. 50,000 per annum
B) Rs. 2,50,000 per annum
C) Rs. 1,00,000 per annum
D) No threshold limit, TDS is applicable from the first rupee
44. Form 16 is issued for TDS on which type of income?
A) Interest on fixed deposits
B) Salaries
C) Rent payments
D) Contract payments
45. Which form is used for issuing TDS certificates to the deductee?
A) Form 16A
B) Form 26AS
C) Form 15G
D) Form 16
46. What is the due date for depositing TDS with the government by the deductor?
A) The 15th of the next month
B) The last day of the month in which TDS was deducted
C) The 7th of the next month
D) The 30th of the month following the deduction
47. When should TDS be deducted?
A) After the income has been received by the assessee
B) At the time of credit of income to the account of the payee or at the time of payment, whichever is earlier
C) Only at the end of the financial year
D) Before the income is earned by the payee
48. Who is responsible for deducting TDS?
A) The recipient of the income
B) The Income Tax Department
C) The deductor (payer)
D) The chartered accountant of the recipient
49. Under which section of the Income Tax Act, 1961 is TDS primarily governed?
A) Section 194A
B) Section 192
C) Section 194
D) Section 194B
50. What does TDS stand for in the context of income tax?
A) Tax Deduction at Source
B) Tax Deposit Scheme
C) Total Due Service
D) Taxable Deduction System
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