(A / B) x C In the above formula for calculating tax credit under section 61 of the Income tax Ordinance 2001, C represents which of the following?

• A) Person’s taxable income for the tax year
• B) Amount of gross tax
• C) Amount of relief allowed
• D) Net Income of the year

Gratuity related to government employees is received on the retirement/death of the employee. Which of the following is the tax treatment of gratuity under the Income Tax Ordinance 2001?

• A) Fully exempt
• B) Taxable @2%
• C) Fully taxable
• D) Partially exempt

Mr. Shahzad, a resident person, during the tax year 2026 received a salary from a Pakistani company of Rs. 400,000 and a dividend of Rs. 100,000 from Canadian company on 28 June 2025. What will be his total income for the tax year 2026?

• A) Rs. 400,000
• B) Rs. 450,000
• C) Rs. 100,000
• D) Rs. 500,000

What will be the tax treatment of motor vehicle provided partly for official and partly for personal use?

• A) 10% of cost (vehicle)
• B) 25% of cost (vehicle)
• C) 5% of cost (vehicle)
• D) 15% of cost (vehicle)

Which of the following is the rate of tax for Mr. Zee, who has earned a basic salary of Rs. 850,000, utilities of Rs. 200,000 and fees of Rs. 200,000 during the tax year 2026?

• A) Rs. 30,000 plus 15% of the amount exceeding Rs. 1,200,000
• B) 1% of the amount exceeding Rs. 600,000
• C) Rs. 180,000 plus 25% of the amount exceeding Rs. 2,200,000
• D) Rs. 6,000 plus 11% of the amount exceeding Rs. 1,200,000

Which of the following is the tax treatment of medical allowance provided with free medical treatment?

• A) Wholly exempted
• B) Wholly taxable
• C) Exempt up to 10% of MTS
• D) Exempt up to 10% of basic salary

What is the tax treatment of the value of a right to acquire shares by the employee under the employee share scheme as per sec 14 of the ITO 2001?

• A) It is deducted from the taxable income
• B) It is chargeable to tax
• C) It is added in the taxable income
• D) It is not chargeable to tax

Employment includes which of the following option:

• A) A directorship or any other office involved in the management of a company
• B) Holding or acting in any public office.
• C) All of the given options
• D) A position entitling the holder to fixed or ascertainable remuneration

What is the tax treatment of the bonus payment received by the employee?

• A) Partly Taxable
• B) Wholly Taxable
• C) Not mentioned in Income Tax Ordinance 2001
• D) Wholly Exempt

Statutory provident fund is also known as:

• A) Government provident fund
• B) None of the given options
• C) Shared provident fund
• D) Unrecognized provident fund

Mr. A earned a basic salary of Rs. 10,500,000 and a conveyance allowance of Rs. 500,000 during the year. Which of the following is the tax liability of Mr. A for the tax year 2026? (Tax Slab: Rs. 616,000 plus 35% of the amount exceeding Rs. 4,100,000)

• A) Rs. 2,845,000
• B) Rs. 3,031,000
• C) Rs. 4,040,000
• D) Rs. 1,955,000

Which of the following is the rate of tax for Mr. Zee, who has earned a basic salary of Rs. 6,000,000, a dearness allowance of Rs. 2,000,000 and a conveyance allowance of Rs. 1,000,000 during the tax year 2026?

• A) Rs. 15,000 plus 12.5% of the amount exceeding Rs. 1,200,000
• B) Rs. 165,000 plus 20% of the amount exceeding Rs. 2,400,000
• C) Rs. 616,000 plus 35% of the amount exceeding Rs. 4,100,000
• D) Rs. 405,000 plus 25% of the amount exceeding Rs. 3,600,000

As per sec 105(3) head office expenditure incurred by the non-resident person outside Pakistan for the purposes of the business of the Pakistan permanent establishment of the person, means:

• A) Any executive or general administration expenditure
• B) Any advertising expenditure
• C) Any selling expenditure
• D) Any manufacturing expenditure

Mr. X, a resident of Pakistan, generated profit from the sale of machinery of Rs. 600,000 in Pakistan but received it in Kuala Lumpur. Which of the following statements is right for this scenario?

• A) Mr. X being resident of Pakistan Rs. 600,000 will be subtracted from Gross total income
• B) Mr. X being resident of Pakistan Rs. 600,000 will be claimed as admissible deduction
• C) Mr. X being resident of Pakistan Rs. 600,000 will be added in Gross total income
• D) Mr. X being resident of Pakistan Rs. 600,000 will be exempted

Mr. Khalid, a resident person, during the tax year 2026 received salary of Rs. 500,000. He also received share of profit of Rs. 70,000 in Korea from his PE situated in Pakistan. What will be his total income for the tax year 2026?

• A) Rs. 500,000
• B) Rs. 70,000
• C) Rs. 570,000
• D) Rs. 400,000

Which of the following is the tax treatment of free hospitalization services provided under the terms of employment?

• A) Wholly exempt
• B) Taxable up to 10% of MTS
• C) Exempt up to 10% of MTS
• D) Wholly taxable

Mr. Zia, a salaried person, has a taxable income of Rs. 45,000,000 for the tax year 2026. What will be his tax liability? (Tax Slab: Rs. 616,000 plus 35% of the amount exceeding Rs. 4,100,000)

• A) Rs. 14,931,000
• B) Rs. 7,200,000
• C) Rs. 19,340,000
• D) Rs. 15,015,000

As per sec. 60 of the ITO 2001, deductible allowance include all of the following, EXCEPT:

• A) Donation
• B) Worker participation fund
• C) Zakat
• D) Worker welfare fund

Mr. A resident of Pakistan received interest on Australian Bonds Rs. 100,000 (half amount received in Pakistan). What is the treatment of this amount for calculating his gross total income?

• A) Exempt from tax
• B) Rs. 50,000 added in his total income
• C) Rs. 100,000 subtracted from his total income
• D) Rs. 100,000 added in his total income

What is the tax treatment of the motor vehicle provided by employer to an employee wholly or partly for the private use of the employee as per sec 13(3) of the ITO 2001?

• A) It is added in the income after tax
• B) It is chargeable to tax
• C) It is not chargeable to tax
• D) It is deducted from the taxable income