'/><rect width='800' height='360' fill='url(%23dots)'/><g transform='translate(200 70)'><g><rect x='0' y='180' width='400' height='30' rx='4' fill='%23ffffff' fill-opacity='0.5'/><rect x='10' y='150' width='380' height='30' rx='4' fill='%23ffffff' fill-opacity='0.65'/><rect x='-10' y='120' width='420' height='30' rx='4' fill='%23ffffff' fill-opacity='0.8'/><rect x='30' y='184' width='40' height='4' rx='2' fill='%23FF801E' fill-opacity='0.7'/><rect x='40' y='154' width='60' height='4' rx='2' fill='%23FF801E' fill-opacity='0.5'/><rect x='20' y='124' width='50' height='4' rx='2' fill='%23FF801E' fill-opacity='0.6'/></g><g transform='translate(60 30)'><path d='M 0 80 L 0 10 Q 140 -10 140 10 L 140 80 Q 70 70 0 80 Z' fill='%23ffffff' fill-opacity='0.95'/><path d='M 280 80 L 280 10 Q 140 -10 140 10 L 140 80 Q 210 70 280 80 Z' fill='%23ffffff' fill-opacity='0.95'/><line x1='140' y1='15' x2='140' y2='75' stroke='%23FF801E' stroke-opacity='0.3' stroke-width='1.5'/><g stroke='%23FF801E' stroke-opacity='0.4' stroke-width='2' stroke-linecap='round'><line x1='20' y1='28' x2='110' y2='25'/><line x1='20' y1='42' x2='110' y2='40'/><line x1='20' y1='56' x2='80' y2='54'/><line x1='170' y1='25' x2='260' y2='28'/><line x1='170' y1='40' x2='260' y2='42'/><line x1='170' y1='54' x2='220' y2='56'/></g></g></g></svg>)
Options
- A
It will taxed in the year of receipt
- B
It will taxed in the year of accrual
-
It will taxed based on the method of accounting followed by receiver
Correct answer
- D
It will taxed in the year of accrual or receipt, whichever is earlier
Why this is the answer
The taxation of interest depends on the taxpayer’s accounting method, either mercantile or cash basis.
Test yourself for real
Take a full NISM Series X mock test.
Same duration, same weighting, same difficulty distribution as the real exam — with explanations on every question.