XX Taxation in Securities Markets - 7
XX Taxation in Securities Markets - 7
Q 1. What is the first step in calculating the estimated total income of the previous year for advance tax payment?
Calculate the tax on income at normal rates
Calculate the tax on income at special rates
Calculate the estimated net taxable income
Calculate the estimated gross total income
Q 2. In which scenario is the transfer of securities not deemed as a transfer, provided certain conditions are met?
Succession of sole proprietorship by a partnership firm
Conversion of a private company into a public company
Conversion of an LLP into a partnership firm
Transfer of assets between unrelated entities
Q 3. How are Zero-Coupon Bonds (ZCBs) issued and redeemed?
Issued at a premium and redeemed at a discount
Issued at face value and redeemed at a discount
Issued at a discount and redeemed at face value
Issued at a premium and redeemed at face value
Q 4. From which date onwards is the rate of TDS on interest payable in respect of bonds issued in an IFSC set at 9%?
1-Apr-21
1-Jul-21
1-Apr-22
1-Apr-23
Q 5. Wow, is the contribution to Tier II NPS accounts by Central Government employees treated for tax deduction purposes?
The deduction is allowed under Section 80C for the entire amount contributed by the employee.
The deduction is allowed under Section 80CCC for the entire amount contributed by the employee.
The deduction is allowed under Section 80CCD(1) for the entire amount contributed by the employee.
The deduction is not allowed for contributions to Tier II NPS accounts.
Q 6. What determines the taxability of dividend income and the applicable tax rate?
Type of investment account
The amount of dividend received
The sector of the company
The geographical location of the shareholder
Q 7. Which entities are eligible to register as Category-II Foreign Portfolio Investors?
government entities and pension funds.
banks and insurance companies.
Venture capital funds and social impact funds.
family offices and charitable organizations.
Q 8. Under what conditions would a distribution of capital assets on total or partial partition of a HUF not be regarded as a transfer for tax purposes?
When assets are transferred to a charity
When assets are transferred to a business partner
When assets are distributed among family members
When assets are transferred to a trust
Q 9. What happens if an individual receives a sum from high premium ULIPs for the second time and subsequently?
No capital gains are calculated
Capital gains are calculated based on the sum received and premiums paid
Capital gains are calculated based on the sum received and the sum assured
Capital gains are calculated based on the sum received and the number of years the policy was active
Q 10. Under which head of income is the income earned by market intermediaries taxable?
House property
Profit and gain from business or profession
Capital gains
Other sources
Q 11. Under what circumstances can AMT credit not be carried forward?
When it relates to the difference between foreign tax credits allowed against AMT and taxes computed under regular provisions
If it exceeds the tax payable as per provisions of AMT
If the taxpayer opts for payment of taxes at concessional rates under Section 115BAC
If the taxpayer opts for Section 80C deductions
Q 12. How should indirect costs be attributed and added to the actual cost of securities held as stock-in-trade, according to general accounting principles?
Indirect costs should not be added to the actual cost
Indirect costs should be allocated based on the face value of the securities
Indirect costs should be allocated based on the historical cost of the securities
Indirect costs should be allocated equally among all securities held
Q 13. How long must listed shares and securities be held to qualify for treatment as capital gains?
6 months
12 months
18 months
36 months
Q 14. How is the cost of acquisition of securities acquired by an amalgamated company under a scheme of amalgamation determined when sold as stock-in-trade?
Fair market value on the date of sale
Historical cost of the securities to the amalgamated company
Cost of acquisition of the securities to the amalgamating company (transferor)
None of the above
Q 15. Which section of the Income-tax Act, 1961 mandates tax deduction from dividend or long-term capital gains arising from units of mutual funds purchased in foreign currencies?
Section 194H
Section 194J
Section 196B
Section 195
Access More Mock Tests Now