Tax Assistant

Tax Assistant Interview Questions and Answers

Updated 19 Dec 2024

Q1. What is your reason for wanting to switch to foreign taxation?

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I am interested in foreign taxation due to the opportunity to expand my knowledge and skills in a different tax system.

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Canada has a progressive tax system where individuals and corporations are taxed based on their income levels.

Canada has federal and provincial/territorial income taxes that are levied based on a progressive tax system.
Income tax rates increase as income levels rise, with higher income earners paying a higher percentage of tax.
There are also consumption taxes such as the Goods and Services Tax (GST) and Harmonized Sales Tax (HST) that are applied to goods and services.
Certain...read more

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Taxation is chosen based on the type of income, deductions, and credits available to the taxpayer.

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Tax rate is the percentage at which an individual or business is taxed on their income or profits.

Tax rate varies depending on the income level and type of income
Tax rates can be progressive, regressive or flat
Tax rates can be different for federal, state and local taxes
For example, the federal income tax rate for 2021 ranges from 10% to 37% depending on income level

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LTCG stands for Long Term Capital Gains and STCG stands for Short Term Capital Gains.

LTCG is the profit earned from the sale of an asset held for more than a year.
STCG is the profit earned from the sale of an asset held for less than a year.
LTCG is taxed at a lower rate than STCG.
Example: Selling a stock after holding it for 2 years would result in LTCG, while selling it after 6 months would result in STCG.

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LTCG is tax on profits from assets held for over a year, while STCG is tax on profits from assets held for less than a year.

LTCG is taxed at a lower rate than STCG.
LTCG is applicable on assets held for more than a year, while STCG is applicable on assets held for less than a year.
LTCG is calculated by subtracting the purchase price from the selling price, while STCG is calculated by subtracting the purchase price from the selling price and adding any applicable fees or commis...read more

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Ans.

Sections of TDS refer to different categories under which tax is deducted at source.

TDS is deducted under different sections of the Income Tax Act, 1961.
Each section specifies the rate at which TDS is to be deducted and the threshold limit for deduction.
For example, Section 194A deals with TDS on interest income, Section 194J deals with TDS on professional fees, etc.