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0456-Business Taxation Assignment


ALLAMA IQBAL OPEN UNIVERSITY, ISLAMABAD
(Department of Commerce)

BUSINESS TAXATION (456)

CHECKLIST

SEMESTER: SPRING, 2012

This packet comprises the following material: -
  1. Text book (One)
  2. Assignment No. 1, & 2
  3. Assignment forms (Two sets )
  4. Schedule for submitting assignments and tutorial meetings

If you find anything missing in this packet, please contact at the address given below:
The
Mailing Officer,
Allama Iqbal Open University
H-8, Islamabad
051-9057611- 12
                                                                                                                    



                                                                                                   Muhammad Munir
                                                                                                   Course Coordinator


ALLAMA IQBAL OPEN UNIVERSITY, ISLAMABAD

(Department of Commerce)

[
WARNING
1.         PLAGIARISM OR HIRING OF GHOST WRITER(S) FOR SOLVING THE ASSIGNMENT(S) WILL DEBAR THE STUDENT FROM AWARD OF DEGREE/CERTIFICATE, IF FOUND AT ANY STAGE.
2.         SUBMITTING ASSIGNMENT(S) BORROWED OR STOLEN FROM OTHER(S) AS ONE’S OWN WILL BE PENALIZED AS DEFINED IN “AIOU PLAGIARISM POLICY”.



Course: Business Taxation (456)                                         Semester: Spring, 2012
Level: BA/B.Com                                                                          Total Marks: 100
Units: 1–9                                                                                          Pass Marks: 40

Assignment No. 1
(Units: 1–4)

Note: You are required to attempt all questions if you are unable to understand any question of assignment, do seek help from your concerned tutor. But keep in mind that tutors are not supposed to solve the assignment questions for you.

Q. 1  Explain the following from income tax viewpoint:                                      (20)
         i)       Accumulated Profits                ii)      Capital Asset
         iii)     Agricultural Income                 iv)     Dividend

Q. 2  Define provident fund. Explain the types of provident fund and their treatment for the calculation of tax.       (20)
        
Q. 3  i)       Explain the “Foreign Tax Credit” with the help of an example.          (10)
         ii)      Briefly explain the income from property not taxable.                        (10)

Q. 4  i)       Discuss the necessity of differentiation between capital and revenue items.         (10)
         ii)      State with reasons whether the following expenses are capital or revenue:            (10)
a)            Paid Rs. 5,000 as freight on goods purchased.
b)            Received Rs. 10,000 from the sale of old machinery.
c)            Paid Rs. 2,500 for acquiring a copyright.
d)            Rs. 5,000 were paid for white-washing the business building.
e)            Cost of issuing shares Rs. 1,200.
Q. 5  From the following information, calculate taxable income, tax payable of Mr. Hassan as an individual for the year ending on 30th June 2011.                                                                    (20)

                                                                                                             Details Amount (Rs.)
         Basic salary per annum............................................................ 540,000
         Bonus.......................................................................................    50,000
         Dearness allowance..................................................................    30,500
         Fixed education allowance for children...................................    10,000
         Incentive award........................................................................    25,000
         Professional books purchased..................................................      6,000
         Insurance money received on maturity of policy..................... 100,000
         Pay in lieu of leave..................................................................    26,000
         Entertainment allowance..........................................................    15,000
         Donation to Pakistan Baitul Mal...............................................    12,000
         Share from AOP.......................................................................    18,000
         Amounts claimed for rebate: ...................................................              
         Contribution to approved pension fund...................................    10,000
         Legal expenses.........................................................................      5,000
                 
         Notes:
i)              Employer has provided him a chauffer driven 2000 cc car, partly for private use, costing Rs. 1 million.
ii)            He is provided with rend free unfurnished accommodation.
iii)          Payment to workers welfare fund is Rs. 12,000 and income tax Rs. 10,000 has already been deducted from his salary.
iv)          The salary of watchman, gardener and sweeper paid by the employer is Rs. 25,000.

Assignment No. 2
(Units: 5–9)

Q. 1  Why is the distinction between capital and revenue items important from income tax viewpoint? What are the various tests used for differentiation between them?                                   (20)


Q. 2  From the following information, calculate tax payable of Mr. Ghulfam for the year ending on 30th June 2011.         (20)
        
         Details                                                                              Amount (Rs.)
         Salary income.......................................................................... 160,000
         Income from business.............................................................. 202,000
         Agricultural income (agricultural tax has been paid to the Government of
         Punjab)..................................................................................... 220,000
         Zakat paid during the year under zakat ordinance....................    12,000
         Approved pension scheme.......................................................    35,000
         Expenses on children education...............................................    45,000
        
Q. 3  What penalties can be imposed in the following cases?                               (20)
         a)      Concealment of Income
         b)      Non-Payment of tax
         c)      Failure to Furnish Statements
         d)      Failure to Maintain Records

Q. 4  Describe the powers and functions of the Commissioner of income tax.     (20)

Q. 5  Define the following terms with reference to Sales Tax (Amendment) Act 1990:
         i)       Exempt Supply                       ii)       Return
         iii)     Input Tax                               iv)      Wholesaler                                 (20)









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