PassSpark

ICAN Taxation 2024 past questions and answers

This 2024 ICAN Taxation set has 20 practice questions. Try these 5 free sample questions, tap a question to reveal the answer and explanation. Then practise the whole 2024 set with instant marking.

Practise the full 2024 setTimed exam mode

Sample ICAN Taxation 2024 questions

1. A manufacturer is legally required to remit a N100 levy per unit sold. After the levy is introduced, the market price rises by N100 and buyers purchase the same quantity, so buyers bear the full economic cost. Which statement correctly distinguishes the two concepts?
  1. Legal incidence identifies who ultimately bears the cost; economic incidence identifies who files the return.
  2. Legal incidence identifies who is legally liable to remit the tax; economic incidence identifies who bears its cost after market adjustment.
  3. Legal incidence and economic incidence must always fall on the same party.
  4. Economic incidence applies only to direct taxes, not transaction levies.

Answer: B. Legal incidence identifies who is legally liable to remit the tax; economic incidence identifies who bears its cost after market adjustment.

The manufacturer has the legal duty to remit the levy, while buyers bear its economic burden because the full amount is reflected in the price. Legal liability and the final economic burden can differ.

2. A Nigerian company with an existing business has an accounting year ending 30 September 2024. For this question, apply the CITA filing rule that its annual company income tax return is due within six months after the accounting year-end. What is the filing deadline?
  1. 31 March 2025
  2. 30 April 2025
  3. 30 September 2025
  4. 31 January 2025

Answer: A. 31 March 2025

Six months after 30 September 2024 is 31 March 2025. The January date is not the applicable six-month deadline for this existing company.

3. An employer pays PAYE on employees' May 2024 salaries. For this question, assume the employer must deduct PAYE and remit it to the relevant State Internal Revenue Service by the 10th day of the following month. By what date must the employer remit the tax?
  1. 31 May 2024
  2. 5 June 2024
  3. 30 June 2024
  4. 10 June 2024

Answer: D. 10 June 2024

The stated deadline is the 10th day of the month following payment, so May PAYE is due by 10 June 2024. The end-of-month dates are later than the stipulated deadline.

4. During 2024, Chika receives cash salary and private use of an employer-provided car. She also receives an exact reimbursement for documented business travel. Under the rule stated here, employment income includes cash salary and taxable benefits in kind, but excludes properly substantiated employer-business expense reimbursements. Which item is included in her employment income?
  1. Only the business-travel reimbursement
  2. Cash salary and the taxable car benefit
  3. Only the reimbursement, because the car belongs to the employer
  4. None of the items, because the employer paid them

Answer: B. Cash salary and the taxable car benefit

Cash salary and the taxable value of private use of the employer's car are employment income under the stated rule. The documented reimbursement merely repays business expenditure and is excluded by the question's premise.

5. A Nigerian company has annual gross turnover of N24,000,000 and CITA taxable profit of N3,000,000. Assume it is an ordinary company with no special exclusion and apply these 2024 CITA bands: turnover not more than N25,000,000 is taxed at 0%; turnover above N25,000,000 and not more than N100,000,000 at 20%; and turnover above N100,000,000 at 30%. Ignore other taxes. What is its company income tax?
  1. N600,000
  2. N900,000
  3. N0
  4. N1,200,000

Answer: C. N0

Turnover of N24,000,000 falls within the stated not-more-than-N25,000,000 band, taxed at 0%, so CITA is N0. Applying a profit-based rate from a higher turnover band would use the wrong band.

More ICAN Taxation years

2026202520232022

All ICAN Taxation years · ICAN subjects

PassSpark questions are original practice questions written to each exam's syllabus and format, in the style of past questions. They are not official past papers and are not affiliated with JAMB, WAEC, NECO, any university or any exam body.