Dear Aspirants, English Language plays a crucial role in Banking and all other competitive exams. To enrich your preparation, here we have provided New Pattern English Questions for IBPS Clerk Mains. Candidates those who are going to appear in IBPS Clerk Mains can practice these questions daily and make your preparation effective.
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Direction (1-10): Read the passage carefully and answer the following questions.
A person can have income from various sources. For calculating tax on income, first, it is necessary to ascertain the source from where the income arises. This is because different income is taxed at different rates. While computing taxable income, the first step is to identify the head of income to which the income belongs.
The Section 14 of Income Tax Act 1961 has classified the sources of income under separate heads. In other words, according to the Income Tax Act, income of an individual is classified into various categories. According to the income tax Act, ‘Income from salaries’ is the head which assimilates any remuneration, which is received by an individual in terms of services provided by him based on a contract of employment. This amount qualifies to be considered for income tax only if there is an employer-employee relationship between the payer and the payee respectively.
Section 17(1) of the Income tax Act gives an inclusive definition of “Salaries” including therein Wages, annuity or pension, gratuity, fees, commission, perquisites or profits in lieu of salary, advance of salary, amount transferred from unrecognized provident fund to recognized provident fund, contribution of employer to a recognized Provident Fund in excess of the prescribed limit, leave encashment, compensation as a result of variation in service contract etc.
Income tax deductions offer a gamut of opportunities for saving tax for the salaried class. With the help of these deductions and exemptions and, one could reduce his/her tax substantially.
A salaried individual having a rented accommodation can get the benefit of HRA (House Rent Allowance). This could be totally or partially exempted from income tax. However, if you aren’t living in any rented accommodation and still continue to receive HRA, it will be taxable.
While presenting the Union Budget 2018, Finance Minister announced a standard deduction amounting to Rs 40,000 for salaried employees. This deduction has been introduced in lieu of Transport allowance and Medical Reimbursement which were earlier allowed to the employees.
Salaried employees can avail exemption for a trip within India under Leave Travel Allowance. The exemption is only for the shortest distance on a trip.
Medical insurance deduction is a deduction, provided for medical expenses. The limit for this deduction is Rs 25,000 for premiums paid for self/family. For premiums paid for parents who are senior citizens, one can claim a deduction uptoRs 30,000.
Another key tax saving tool for the salaried employees is the interest paid on the home loans. Homeowners have the option to claim up to INR 2 lakhs as a deduction for interest on home loan for a self-occupied property.
Income Tax Act provides exemptions for interest on education loans.
Section 80G of the Income Tax Act, 1961 offers income tax exemption to an assessee who makes donations to charitable organizations.
Section 80TTA of the Income Tax Act, 1961 offers a deduction of INR 10,000 on income earned in the form of bank interest.
Another category under which Income Tax Act has classified the individual’s income is ‘Income from House Property’. This head covers rental income arising from letting out a house property. If the property is not let out, then it is taxed on the basis of expected rent.A house property could be your home, an office, a shop, a building or some land attached to the building like a parking lot. The Income Tax Act does not differentiate between a commercial and a residential property.
Under section 24 of the Income Tax Act you are allowed to make certain deduction from the Net Annual Value of your House Property.
If the individual and his or her spouse have jointly taken a home loan, both can claim tax exemption towards payment of principal and interest. There are a number of measures an individual can undertake to save tax on Income from House Property.
If the assesse already has one property registered in his or her name, it is a good idea to register the second property in the name of individual’s spouse or relative so as to avoid excess taxation.
‘Income from business and profession’ is another head under which the income of an individual is classified. The income taxable under this head is the difference between the revenue received on running the business and expenses incurred. Section 29 says that the profits under the head ‘Profits and Gains of Business or Profession’ are calculated in accordance with the provisions contained in Sections 30 to 44DB, which provide for the deductions to be made from the gross income of the business. These deductions are rent, rates, taxes, repairs and insurance for building, used for the purpose of the assessee’s business, repairs and insurance premium paid in connection with the plant, machinery, furniture etc. used in business or profession, interest on borrowed capital.
A capital gain is the profit from the sale of a capital asset (including investments such as shares and bonds). The loss on the sale of such assets is treated as a capital loss. Any profit or gain arising from transfer of capital asset held as investments are chargeable to tax under the head capital gains. The gain can be on account of short- and long-term gains. A capital gain arises only when a capital asset is transferred.In India, the long-term capital gains on sale of listed securities exceeding Rs.1 lakh are taxed at 10% as per the Union Budget 2018. The short-term gains will be taxed at 15 percent.
1) According to the passage, which of the followings will be allowed as a deduction from the taxable income of the people who are engage in business activities?
a) normal Profit from general activities of business
b) any other benefit (may cash or not) from the business
c) profit from regular activities of business
d) rent paid for business premises
e) profit from speculation business
2) According to the passage, which of the following deductions has been introduced recently in place of transport allowance?
a) donations to charitable organizations
b) interest on education loan
c) standard deduction
d) medical reimbursement
e) interest paid on home loans
3) According to the passage, which of the followings will not be included in the salary?
b) advance salary
e) operating expenses
4) According to the passage, which of the followings will not be considered as a category for the classification of individual’s income?
a) income from house property
b) income from agricultural activities
c) income from capital gain
d) profit and gain from business or profession
e) income from salary
5) Which of the following statements is true in the context of the passage?
a) if the individual and his or her spouse have jointly taken a home loan, both can claim tax exemption towards payment of principal and interest.
b) according to the Income Tax Act, income of an individual is classified into six categories.
c) in India, the long-term capital gains on sale of listed securities exceeding Rs.2 lakh are taxed at 10% as per the Union Budget 2018.
d) None of the above
e) All are true
6) Find the incorrect statement on the basis of the given passage.
a) the Income Tax Act does not differentiate between a commercial and a residential property
b) under section 24 of the Income Tax Act you are allowed to make certain deduction from the Net Annual Value of your House Property
c) as per the Union Budget 2018, the short-term gains will be taxed at 15 percent
d) an individual’s income from various sourceswill be taxed at same rate
e) all are correct
7) Choose the word which as same meaning as the word inclusive
8) Choose the word which as opposite meaning as the word substantially
9) Choose the word which as opposite meaning as the word exemption
10) Choose the word which as same meaning as the word partially
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1) Answer: d)
It is mentioned in the passage that Sections 30 to 44DB allow certain deductions from the gross income of the business. These are rent, rates, taxes, repairs and insurance for building, used for the purpose of the assessee’s business.
2) Answer: c)
It is clearly mentioned in the passage that while presenting the Union Budget 2018, Finance Minister announced a standard deduction for salaried employees. This deduction has been introduced in lieu of Transport allowance and Medical Reimbursement which were earlier allowed to the employees.
3) Answer : e)
According to the passage, operating expenses will not be included in the salary as it is not mentioned in the passage.
4) Answer: b)
According to the passage, income from agricultural activities cannot be considered as a category for the categorization of individual’s income as it is not mentioned anywhere in the passage.
5) Answer: a)
According to the passage true statement is “if the individual and his or her spouse have jointly taken a home loan, both can claim tax exemption towards payment of principal and interest.”
6) Answer: d)
It is mentioned in the passage that for calculating tax on income, first, it is necessary to ascertain the source from where the income arises. This is because different income is
taxed at different rates.
7) Answer: e)
The meaning of “inclusive” is “comprehensive / wide ranging/ complete”.
8) Answer: d)
The meaning of “substantially” is “considerably/ significantly” and its opposite is “trivially/ imperceptibly”.
9) Answer: b)
The meaning of “exemption” is “exception / immunity” and its opposite is “ inclusion/ insertion”.
10) Answer: d)
The meaning of “partially” is “moderately /partly / incompletely”.
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|Topic||Daily Publishing Time|
|Daily News Papers & Editorials||8.00 AM|
|Current Affairs Quiz||9.00 AM|
|Current Affairs Quiz (Hindi)||9.30 AM|
|IBPS SO/NIACL AO Prelims – Reasoning||10.00 AM|
|IBPS SO/NIACL AO Prelims – Reasoning (Hindi)||10.30 AM|
|IBPS SO/NIACL AO Prelims – Quantitative Aptitude||11.00 AM|
|IBPS SO/NIACL AO Prelims – Quantitative Aptitude (Hindi)||11.30 AM|
|Vocabulary (Based on The Hindu)||12.00 PM|
|IBPS SO/NIACL AO Prelims – English Language||1.00 PM|
|SSC Practice Questions (Reasoning/Quantitative aptitude)||2.00 PM|
|IBPS Clerk – GK Questions||3.00 PM|
|SSC Practice Questions (English/General Knowledge)||4.00 PM|
|Daily Current Affairs Updates||5.00 PM|
|SBI PO/IBPS Clerk Mains – Reasoning||6.00 PM|
|SBI PO/IBPS Clerk Mains – Quantitative Aptitude||7.00 PM|
|SBI PO/IBPS Clerk Mains – English Language||8.00 PM|