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CA Final Anti-avoidance Provisions — practice questions — page 3

Explore 65 free Anti-avoidance Provisions questions in CA Final Taxation. Open each question or exercise to read its content, reference answers and available explanation.

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Anti-avoidance Provisions questions and exercises with answers

Showing questions 61–65 of 65.

Which payments do multinationals use to erode a higher-tax base?Read the answer and worked solution →BEPS Action 12 deals with disclosure of what?Read the answer and worked solution →Which asset type is described as the raw material of tax avoidance in BEPS planning?Read the answer and worked solution →Which BEPS tool is easy to create without moving assets, functions or personnel?Read the answer and worked solution →Accounting substance over form shows economic reality, not just:Read the answer and worked solution →

Worked practice questions

Which payments do multinationals use to erode a higher-tax base?

  1. GST paid on local sales
  2. Customs duty on imports
  3. Interest and royalties
  4. Salaries to local staff
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Correct answer: C. Interest and royalties

Deductible payments such as interest or royalties reduce the taxable base in the higher-tax country.

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BEPS Action 12 deals with disclosure of what?

  1. Aggressive tax planning
  2. Transfer pricing documents
  3. Treaty shopping abuse
  4. Digital services tax
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Correct answer: A. Aggressive tax planning

Action 12 covers disclosure of aggressive tax planning, which many tax havens opted out of.

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Which asset type is described as the raw material of tax avoidance in BEPS planning?

  1. Intellectual property
  2. Finished inventory
  3. Agricultural land
  4. Bank cash balances
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Correct answer: A. Intellectual property

Intangibles like patents and trademarks are easy to value and move, so they are central to profit shifting.

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