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Income Tax MCQs Pakistan — 200+ Practice Questions

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1
Question 1 of 52 Computation of Taxable Income
Basic
📖 Section 10. Total Income - ITO, 2001
Which section of the Income Tax Ordinance, 2001 deals with Total Income ?
1 Section 9 ❌
2 Section 10 ✅
3 Section 11 ❌
4 Section 12 ❌
✅ Correct Answer!
✅
Correct Answer
📝 Explanation
Total income represents the aggregate of income from all heads, including exempt income, for the tax year.
⚖️ Legal Reference
📖 Income Tax Ordinance, 2001 — Section 10. Total Income - ITO, 2001
💡 Why This Matters
Understanding this provision is essential for tax compliance and frequently tested in CA, ICMAP & ACCA Pakistan exams.
2
Question 2 of 52 Computation of Taxable Income
Basic
📖 Section 9. Taxable Income - ITO, 2001
Which section of the Income Tax Ordinance, 2001 deals with Taxable Income ?
1 Section 9 ✅
2 Section 10 ❌
3 Section 11 ❌
4 Section 12 ❌
✅ Correct Answer!
✅
Correct Answer
📝 Explanation
The taxable income of a person for a tax year is the total of income under all heads after deducting allowable allowances, but it shall not be reduced below zero.
⚖️ Legal Reference
📖 Income Tax Ordinance, 2001 — Section 9. Taxable Income - ITO, 2001
💡 Why This Matters
Understanding this provision is essential for tax compliance and frequently tested in CA, ICMAP & ACCA Pakistan exams.
3
Question 3 of 52 Computation of Taxable Income
Basic
📖 Section 11. Heads of Income - ITO, 2001
Which section of the Income Tax Ordinance, 2001 deals with Heads of Income ?
1 Section 9 ❌
2 Section 10 ❌
3 Section 11 ✅
4 Section 12 ❌
✅ Correct Answer!
✅
Correct Answer
📝 Explanation
There are five heads of income: Income from Salary, Income from Property, Income from Business, Capital Gains, and Income from Other Sources.
⚖️ Legal Reference
📖 Income Tax Ordinance, 2001 — Section 11. Heads of Income - ITO, 2001
💡 Why This Matters
Understanding this provision is essential for tax compliance and frequently tested in CA, ICMAP & ACCA Pakistan exams.
4
Question 4 of 52 Head of Income
Basic
📖 Section 12. Salary - ITO, 2001
Which section of the Income Tax Ordinance, 2001 deals with Income from Salary ?
1 Section 12 ✅
2 Section 15 ❌
3 Section 18 ❌
4 Section 37 ❌
✅ Correct Answer!
✅
Correct Answer
📝 Explanation
Section 12 of the Income Tax Ordinance, 2001 covers income taxable under the head Salary, including pay, allowances, and employment benefits etc.
⚖️ Legal Reference
📖 Income Tax Ordinance, 2001 — Section 12. Salary - ITO, 2001
💡 Why This Matters
Understanding this provision is essential for tax compliance and frequently tested in CA, ICMAP & ACCA Pakistan exams.
5
Question 5 of 52 Head of Income
Basic
📖 Section 15. Income from Property - ITO, 2001
Which section of the Income Tax Ordinance, 2001 deals with Income from Property ?
1 Section 15 ✅
2 Section 18 ❌
3 Section 37 ❌
4 Section 39 ❌
✅ Correct Answer!
✅
Correct Answer
📝 Explanation
Any rent received or receivable by a person, except exempt income, is taxable under the head Income from Property.
⚖️ Legal Reference
📖 Income Tax Ordinance, 2001 — Section 15. Income from Property - ITO, 2001
💡 Why This Matters
Understanding this provision is essential for tax compliance and frequently tested in CA, ICMAP & ACCA Pakistan exams.
6
Question 6 of 52 Head of Income
Basic
📖 Section 18. Income from Business - ITO, 2001
Which section of the Income Tax Ordinance, 2001 deals with Income from Business ?
1 Section 37 ❌
2 Section 39 ❌
3 Section 18 ✅
4 Section 12 ❌
✅ Correct Answer!
✅
Correct Answer
📝 Explanation
Any income derived from business, other than exempt income, is chargeable to tax under the head Income from Business.
⚖️ Legal Reference
📖 Income Tax Ordinance, 2001 — Section 18. Income from Business - ITO, 2001
💡 Why This Matters
Understanding this provision is essential for tax compliance and frequently tested in CA, ICMAP & ACCA Pakistan exams.
7
Question 7 of 52 Head of Income
Basic
📖 Section 37. Capital Gain - ITO, 2001
Which section of the Income Tax Ordinance, 2001 deals with Capital Gains ?
1 Section 39 ❌
2 Section 37 ✅
3 Section 9 ❌
4 Section 11 ❌
✅ Correct Answer!
✅
Correct Answer
📝 Explanation
Any profit earned from the sale or disposal of immovable property is taxable under the head Capital Gains.
⚖️ Legal Reference
📖 Income Tax Ordinance, 2001 — Section 37. Capital Gain - ITO, 2001
💡 Why This Matters
Understanding this provision is essential for tax compliance and frequently tested in CA, ICMAP & ACCA Pakistan exams.
8
Question 8 of 52 Head of Income
Basic
📖 Section 39. Income from Other Sources - ITO, 2001
Which section of the Income Tax Ordinance, 2001 deals with Income from Other Sources ?
1 Section 37 ❌
2 Section 40 ❌
3 Section 39 ✅
4 Section 44 ❌
✅ Correct Answer!
✅
Correct Answer
📝 Explanation
Any income earned by a person that does not fall under the other four heads of income is treated as Income from Other Sources and is chargeable to tax.
⚖️ Legal Reference
📖 Income Tax Ordinance, 2001 — Section 39. Income from Other Sources - ITO, 2001
💡 Why This Matters
Understanding this provision is essential for tax compliance and frequently tested in CA, ICMAP & ACCA Pakistan exams.
9
Question 9 of 52 Types of Income
Basic
📖 Section 11. Heads of Income - ITO, 2001
How many Heads of Income are prescribed under the Income Tax Ordinance, 2001 ?
1 2 ❌
2 3 ❌
3 4 ❌
4 5 ✅
✅ Correct Answer!
✅
Correct Answer
📝 Explanation
There are five main heads of income: Salary, Property, Business, Capital Gains, and Other Sources.
⚖️ Legal Reference
📖 Income Tax Ordinance, 2001 — Section 11. Heads of Income - ITO, 2001
💡 Why This Matters
Understanding this provision is essential for tax compliance and frequently tested in CA, ICMAP & ACCA Pakistan exams.
10
Question 10 of 52 Exemptions and Tax Concessions
Basic
📖 Section 41. Agricultural Income - ITO, 2001
Which section of the Income Tax Ordinance, 2001 deals with Agricultural Income ?
1 Section 39 ❌
2 Section 40 ❌
3 Section 41 ✅
4 Section 42 ❌
✅ Correct Answer!
✅
Correct Answer
📝 Explanation
Any agricultural income received or earned by a person shall be exempt from tax under the Income Tax Ordinance, 2001.
⚖️ Legal Reference
📖 Income Tax Ordinance, 2001 — Section 41. Agricultural Income - ITO, 2001
💡 Why This Matters
Understanding this provision is essential for tax compliance and frequently tested in CA, ICMAP & ACCA Pakistan exams.

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