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 PE of the person, include all of the following expenses, EXCEPT::

• A) any salary paid to an employee employed by the head office outside Pakistan
• B) any insurance against risks of damage outside Pakistan
• C) any travelling expenditures of such employee
• D) any rent, local rates and taxes

Mr. X, a non-resident of Pakistan, generated profit from sale of machinery 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 non-resident of Pakistan Rs. 600,000 will be subtracted in Gross total income
• B) Mr. X being non-resident of Pakistan Rs. 600,000 will be added in Gross total income
• C) Mr. X being non-resident of Pakistan Rs. 600,000 will be exempted
• D) Mr. X being non-resident of Pakistan Rs. 600,000 will be claimed as admissible deduction

A concessional loan of Rs. 1 million is provided by the employer at a markup of 8% per annum (the benchmark rate for the tax year 2026 is 10% per annum) to a salaried person. What will be the value of the taxable benefit?

• A) Rs. 40,000
• B) Rs. 60,000
• C) Rs. 57,500
• D) Rs. 20,000

Mr. X resident of Pakistan earned income from Property situated in London Rs. 50,000 but received in India. Which of the following is right for the above scenario?

• A) Mr. X being resident of Pakistan Rs. 50,000 will be subtracted in Gross total income
• B) Mr. X being resident of Pakistan Rs. 50,000 will be exempted
• C) Mr. X being resident of Pakistan Rs. 50,000 will be added in Gross total income
• D) Mr. X being resident of Pakistan Rs. 50,000 will be claimed as admissible deduction

Mr. Shahzad, earning a basic salary of Rs. 600,000, has been provided with the house rent accommodation of Rs. 450,000 for the tax year 2026. What will be his taxable income?

• A) Rs. 250,000
• B) Rs. 450,000
• C) Rs. 1,050,000
• D) Rs. 600,000

What is the tax treatment of the utilities provided by an employer to an employee under sec 13(6) of the ITO 2001?

• A) The book value of the utilities provided along with any receipts made by the employee for the utilities will not be included in Salary
• B) The FMV of the utilities provided along with any payment made by the employee for the utilities will not be included in Salary
• C) The FMV of the utilities provided, as reduced by any payment made by the employee for the utilities will be included in Salary
• D) The book value of the utilities provided along with any receipts made by the employee for the utilities will be included in Salary

Mr Zee, an employee of ABC Co., is earning a basic salary of Rs. 600,000. The company has provided a car worth Rs. 700,000 for his personal use. What will be his taxable income for the tax year 2026?

• A) Rs. 670,000
• B) Rs. 600,000
• C) Rs. 500,000
• D) Rs. 70,000

As per section 104(3), which one of the following statements hold true for the taxpayer who has a foreign loss carried forward for more than one tax year?

• A) the most recent loss for the year shall be set off first
• B) none of the given options
• C) the loss for the earliest year shall be set off first
• D) the loss for earliest year shall not be accounted for

If the AOP has paid tax for a tax year, the amount received by a member of the association in the capacity as member out of the income of the association shall be ________________________ u/s 92 for the tax year 2026.

• A) Taxable up to 50%
• B) Totally exempt
• C) Totally taxable
• D) Exempt up to 10%

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

The amount of relief allowed as per sec. 61 of the ITO 2001 to an individual is the lesser of the actual amount of donation or ________% of the taxable income for the tax year 2026.

• A) 15%
• B) 25%
• C) 30%
• D) 20%

Mr. Aqeel earned a basic salary of Rs. 450,000 and utilities of Rs. 100,000 during the year. Which of the following is the tax liability of Mr. Aqeel for the tax year 2026?

• A) Rs. 3,000
• B) Rs. 1,000
• C) Rs. 0
• D) Rs. 2,000

What is the tax treatment of the accommodation or housing provided by an employer to an employee as per sec 13(12) of the ITO 2001?

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

Mr. A having a taxable income of Rs. 600,000 and gross tax liability of Rs. 50,000 during the tax year 2026, donated Rs. 30,000 to the educational institution. What will be the amount of tax credit as per sec. 61 of the ITO 2001 allowed to Mr. A?

• A) Rs. 6,500
• B) Rs. 4,500
• C) Rs. 7,000
• D) Rs. 2,500

Gratuity amount is fully taxable if received:

• A) By the employee of Baluchistan government
• B) By the employee of Punjab government
• C) From the approved gratuity fund
• D) By the non-resident individual

The commutation of pension where the pension scheme is approved by the Board, is exempted under:

• A) Clause (122), Part I of Second Schedule
• B) Clause (121), Part I of Second Schedule
• C) Clause (12), Part I of Second Schedule
• D) Clause (112), Part I of Second Schedule

Which of the following is the general formula for calculating tax credits?

• A) (A / B) x C
• B) (A / B) + C
• C) (A - B) x C
• D) (A + B) x C

Which of the following authority may grant approval to any type of gratuity fund?

• A) Superior judiciary
• B) Federal Tax Ombudsman
• C) Commissioner of Income Tax
• D) Federal Government

Which of the following is/are the deductible allowance from total income of an individual?

• A) Worker’s Participation Fund
• B) Zakat
• C) All of the given options
• D) Worker’s Welfare Fund

A salaried individual taxpayer shall be charged to tax for the tax year 2026 if taxable income is:

• A) greater than Rs. 200,000 but lesser than Rs. 300,000
• B) greater than Rs. 300,000 but lesser than Rs. 400,000
• C) lesser than Rs. 400,000
• D) greater than Rs. 600,000