F1 - tax

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Author:
annastudycima
ID:
47067
Filename:
F1 - tax
Updated:
2010-11-03 13:38:00
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tax
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tax various
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  1. Co Z has a factory in Malaysia, retail outlets in HK. Co reg office is London, HO in Cayman islands. Board meeting in Cayman islands. Which is Z's country of residence?
    A - Malaysia
    B - England
    C - Cayman Islands
    D - HK
    C - Cayman Islands
    (this multiple choice question has been scrambled)
  2. Which of the following is a source of tax rules? A - IAS
    B - Local co legislation
    C - International tax treaties
    D - Domestic accounting practice
    • C - International tax treaties
    • others source of accounting rules
  3. EU supernatioanl body, describe effect on member states' tax rules
    EU issues rules on sales taxes, which must be applied by all member states.
  4. UK, different income taxed to different rules, name of this system?
    Schedular system
  5. Name 4 payments usually affected by withholding tax.
    Interest payments

    Dividends

    Royalties

    Capital gains accruing on non-residents
  6. Name 3 methods of giving double taxation relief.
    Full deduction

    Exemption

    Credit
  7. Double tax relief is used to :
    A - Ensure you do not pay tax twice on any of your income
    B - Mitigate taxing overseas income twice
    C - Avoid taxing dividends received from subsid in the same country twice
    D - Provide relief where a company pays tax at double the normal rate
    B - Mitigate taxing overseas income twice
    (this multiple choice question has been scrambled)
  8. The OECD model tax convention defines a permanent establishment to include a No. of diff types of est.:

    1 place of management
    2 warehouse
    3 workshop
    4 quarry
    5 building site used for 9 months

    Which above are incl in OECD list of perm estbl A - 1, 2 & 3
    B - 1, 3 & 4
    C - 2, 3 & 4
    D - 3, 4 & 5
    B - 1, 3 & 4

    1 place of management

    3 workshop

    4 quarry
  9. Corporate residence for tax purposes can be determined in a no. of ways, depending on the country concerned.

    Which ONE of the following is NOT normally used to determine corporate residence for tax purpose?

    A - the country where most of the entity's products are sold
    B - the country where management of the entity hold their meetings
    C - the country from which control is exercised
    D - the country of incorporation of the entity
    A - the country where most of the entity's products are sold
    (this multiple choice question has been scrambled)
  10. Entity DP, in country A receives a dividend from an entity in country B. The gross dividend of $50,000 is subject to withholding tax of $5,000 & $45,000 is paid to DP.

    Country A levies a tax of 12% on overseas dividends.

    Ctry A & B have signed a double taxation treaty based on OECD model and both apply the credit method when relieving double taxation.

    How much tax would DP be expected to pay in Ctry A ?

    A - $400
    B - $1000
    C - $5400
    D - $6000
    B - $1000

    gross 50000
    tax due 12% 6000
    paid WH tax -5000
    due 1000
    (this multiple choice question has been scrambled)
  11. Where a resident entity runs an OS op as a branch, certain tax implications arise.

    Which of the following does not usually apply in relation to an OS branch?

    A - Assets can be transferred to the branch without triggering capital gain

    B - Corporate income tax is paid on profits remitted by the branch

    C - Tax depreciation can be claimed on any qualifying assets used in the trade of the branch

    D - Losses sustained by the branch are immediately deductible against the resident entity's income
    B - Corporate income tax is paid on profits remitted by the branch

    is paid on all profits of branch not just those remitted
  12. The following details relate to EA
    Incorporated in country A
    Carries out main business in country B
    Snr management operate in country C & effective ctrl is exercised from C
    Assume countries A, B & C all signed double tax treaties based on OECD

    Which country will EA be deemed to be resident in for tax purposes?

    A - Country C
    B - Country A
    C - Country B
    D - both countries B & C
    A - Country C
    (this multiple choice question has been scrambled)
  13. The OECD model defines a permanent tax est.

    Which ONE is not listed

    A - factory
    B - site of 11 month construction project
    C - office
    D - oil well
    B - site of 11 month construction project

    only if more than 12 months
    (this multiple choice question has been scrambled)
  14. Developed countries generally uses 3 tax bases, one is income, list other 2.
    Net assets & consumption
  15. HC carries out main business in country A
    HC is incorporated in country B
    HC's snr management controls from country C
    HC raises finances & is quoted on stock exchange in D
    Assume A B C & D have signed double taxation treaties. Which country deemed resident for tax?

    A - country C
    B - country A
    C - country B
    D - country D
    A - country C
    (this multiple choice question has been scrambled)
  16. EB has an investment of 25% equity shares in XY, entity in foreign country. EB receives a dividend of £90,000 from XY, amt is after deducting withholding tax of 10%.

    XY had profits before tax of £1.2 mil & paid tax of £200,000.

    How much underlying tax can EB claim for double taxation relief?
    • net dividend 90,000
    • witholding tax 10,000
    • gross divid 100,000

    • tax 200,000
    • PAT 1,000,000
    • tax rate 0.2

    tax due 100,000 x 0.2 = 20,000
  17. Excise duties are deemed to be the most suitable for commoditees that have certain specific characteristics. List THREE.
    • Easily defined products
    • Limited number of large producers
    • Produced in large volume
  18. Which of the following is an indirect tax?

    A - Company income tax
    B - Sales tax
    C - withholding tax
    D - Employee tax
    B - Sales tax
    (this multiple choice question has been scrambled)
  19. The cost of sales tax is borne by which person?
    A - end consumer
    B - supplier of raw materials
    C - wholesaler
    D - retailer
    A - end consumer
    (this multiple choice question has been scrambled)
  20. Which of the following types of taxes is regarded as an indirect tax?

    A - taxes on income
    B - taxes on inheritance
    C - taxes on capital gains
    D - Sales tax
    D - Sales tax
    (this multiple choice question has been scrambled)
  21. AE purchases products from a foreign entity & imports them to country A. On import, products are subject to excise duty of $5 per item & VAT of 15% on cost plus excise duty.

    AE purchased 200 items for $30 ea & after importing them sold all of them for $50 ea plus VAT at 15%.

    How much is due to be paid to the tax authorities?

    A - $2500
    B - $1450
    C - $450
    D - $2050
    B - $1450

    VAT out (200 x 50 x 15%) 1500
    VAT in (200 x 35 x 15%) -1050
    VAT payable 450
    excise (200 x 5) 1000

    Total payable 1450
    (this multiple choice question has been scrambled)
  22. HN purchases products from a foreign country. The products cost $14 ea & subject to excise duty of $3 per item & VAT 15%.

    If HN imports 1000 items how much does it pay to the tax authorities?

    A - £5100
    B - £2100
    C - £5550
    D - £19550
    C - £5550

    cost 14000
    duty 3000
    17000

    VAT 15% 2550

    paid 5550
    (this multiple choice question has been scrambled)

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