Income from immovable property includes income from agriculture and forestry

Select one:

True

False

Tax planning opportunities arise due to difference in --------------amongst various countries

a.

Tax exemptions

b.

Both A and B

c.

Neither A nor B

d.

Tax rate

Ininternational taxation, which of the following statement is/are not true

1. Gain is referred to as the profit deriving from the disposal of tangible and intangible assets and liabilities.

2. Penalty charges for late payment shall be regarded as interest for the purpose of Article 11.

3.The tax charged on dividend income shall not exceed 15% of the gross income in all cases.

a.

2 only

b.

1 and 3 only

c.

2 and 3 only

d.

1, 2 and 3

Which of the following statement is not true regarding Article 6 of OECD model?

a.

D. Residence-source conflict results in a doubletaxation

b.

A. immovable propertytaxationcan vary a lot from country to country

c.

C. ships, boats and aircraft shall be regarded as immovable property

d.

B. income deriving from immovable property is calculated on the grounds of estimations

Dividends paid by a company which is a resident of a Contracting State to a resident of the other Contracting State may be taxed in that other State.

Select one:

True

False

Company X paid interest on $10,000 @ 10% to a resident in the same state. He purchased 50% of the share in Company X and claims interest at 12%. According to Article 11 of OECD model, the interest allowed for tax deduction is

a.

10%

b.

2%

c.

NIL

d.

12%

Interest paid in excess part of the last payments shall remain taxable, in case of change in relationship between parties.

Select one:

True

False

Income from employment contract derived by a resident of a Country A in respect of an employment exercised in the other Country B shall be taxable only in the Country A if:

(i) the employer is present in the source State for at least 183 days in a 12-monthperiod

(ii) the remuneration is paid by, or on behalf of, an employer who is a resident of the source State

(iii) the remuneration is not borne by a PE which the employer has in the source State.

Which of the following is correct?

a.

i only

b.

i and iii only

c.

All of the above

d.

ii and iii only

Two enterprises shall be considered as associated enterprises if at any time during the previous year, following condition is satisfied -

a.

Providing guarantee for at least 5% of the total borrowings of enterprise

b.

Tapping at least 50% of raw material from the enterprise

c.

Holding 15% voting power in another enterprise

d.

Advancing of loan which is at least 51% of the book value of the assets of the borrower enterprise

The tax is collected and paid to the government by the resident payer is referred as withholdingtax.

Select one:

True

False

Article 6 applies to which of the following categories?

i. To the income from immovable property of an enterprise

ii. To income derived from the direct use, letting, or use in any other form of immovable property.

iii. To income from ships, boat and aircraft

a.

i only

b.

i and ii only

c.

ii and iii only

d.

all of the above

Capital gain tax is taxed on the amount of money received on the sale of assets

Select one:

True

False

Company X resident in Country A pays interest to Company Y a resident of Country B. Interest paid is:

a.

Taxable in Country B

b.

Not taxable in any country

c.

Taxable in Country A and Country B with relief

d.

Taxable in Country A

Income deriving from immovable property refers to

1. the rent that is paid by a tenant (i.e. the user of the real property) to a property owner

2. income deriving from immovable property is calculated on the grounds of estimation

3. on the grounds of the savings that the property owner gets if this was supposed to rent that property

a.

1 only

b.

1 and 3 only

c.

1,2 and 3

d.

2and 3 only

Which of the following will not be considered as an Associate Enterprise?

a.

Total number of board of directors in A Ltd is 5 out of which 3 directors are appointed by B Ltd

b.

Total borrowing of B Ltd is of $1 million. Out of which $75,000 is guaranteed by A Ltd

c.

A Ltd directly holds 50,000 shares in B Ltd. This shareholding consists of 56% of voting power in B Ltd

d.

Total book value of assets of A Ltd is $50,000, B Ltd has advanced loan of $27,000 to A Ltd