Mastering TOEIC Reading: Practice Test on Business Tax Guidelines

Part 1: Incomplete Sentences

1. The company must file its annual tax return by the ___ deadline to avoid penalties.
   A. statutory
   B. stationary
   C. statuary
   D. stationery

2. Businesses are required to ___ accurate records of all financial transactions for tax purposes.
   A. maintain
   B. sustain
   C. retain
   D. obtain

3. The tax authority may conduct an ___ to verify the accuracy of a company’s tax filings.
   A. audit
   B. audition
   C. audience
   D. auditorium

4. Small businesses often struggle to ___ with complex tax regulations without professional assistance.
   A. comply
   B. complete
   C. compile
   D. compel

5. Failure to submit tax documents on time may result in substantial ___.
   A. fines
   B. finds
   C. funds
   D. founds

6. Companies must ___ their taxable income by subtracting allowable deductions from their gross revenue.
   A. calculate
   B. calibrate
   C. cultivate
   D. culminate

7. The ___ rate for corporate income tax varies depending on the company’s annual earnings.
   A. applicable
   B. appliance
   C. application
   D. applaud

8. Businesses should ___ all receipts and invoices as evidence for claimed expenses.
   A. preserve
   B. persevere
   C. perceive
   D. permeate

9. Tax laws are subject to frequent changes, requiring companies to stay ___ of new regulations.
   A. abreast
   B. abroad
   C. abridge
   D. abrupt

10. Companies operating in multiple jurisdictions must navigate complex ___ tax rules.
    A. international
    B. interior
    C. intermediate
    D. intermittent

11. The ___ of taxes owed is based on the company’s net profit for the fiscal year.
    A. assessment
    B. assortment
    C. assignment
    D. assumption

12. Businesses can often reduce their tax liability by taking advantage of various ___ and credits.
    A. deductions
    B. dedications
    C. deductions
    D. derogations

13. Companies must ___ their tax returns electronically or by mail, depending on their size and preferences.
    A. submit
    B. submarine
    C. submerge
    D. sublimate

14. The tax code provides ___ for certain types of business expenses, such as research and development costs.
    A. incentives
    B. incense
    C. incidence
    D. incisors

15. Accurate financial statements are ___ for determining a company’s tax obligations.
    A. crucial
    B. cruel
    C. crumble
    D. crucible

16. Companies must ___ their tax identification number on all official tax documents.
    A. include
    B. incline
    C. incubate
    D. inculcate

17. The tax authority may grant an ___ for filing taxes if a company faces extraordinary circumstances.
    A. extension
    B. extensive
    C. extention
    D. extinction

18. Businesses should consult with tax professionals to ensure ___ with all relevant tax laws.
    A. compliance
    B. compliment
    C. complement
    D. complaint

19. Companies must report any ___ income, including interest earned on investments.
    A. passive
    B. passionate
    C. passing
    D. passage

20. The ___ of tax rates for different income brackets can significantly impact a company’s financial planning.
    A. structure
    B. stricture
    C. striction
    D. striation

21. Businesses must ___ their tax payments quarterly or annually, depending on their size and income.
    A. remit
    B. remote
    C. remand
    D. remain

22. Companies should maintain a ___ system for organizing tax-related documents.
    A. filing
    B. filling
    C. feeling
    D. falling

23. The tax code allows for certain ___ to be carried forward to future tax years.
    A. losses
    B. loses
    C. looses
    D. looses

24. Proper tax planning can help businesses ___ their overall tax burden legally.
    A. minimize
    B. minify
    C. miniature
    D. minister

25. Companies must ___ any changes in their business structure or ownership to the tax authorities.
    A. report
    B. retort
    C. resort
    D. rapture

26. The tax authority may impose ___ on companies that fail to pay their taxes on time.
    A. penalties
    B. penalities
    C. penuries
    D. pennies

27. Businesses should ___ all tax-related correspondence from the government promptly.
    A. address
    B. adress
    C. adduce
    D. additive

28. Companies must ___ their tax returns for a specified number of years in case of future audits.
    A. retain
    B. retrain
    C. restrain
    D. regain

29. The tax code provides ___ rules for depreciating business assets over time.
    A. specific
    B. specified
    C. specious
    D. spacious

30. Businesses should stay informed about potential tax ___ that may affect their industry.
    A. reforms
    B. refers
    C. refrains
    D. reframes

TOEIC Reading Practice Test on Business Tax Guidelines

Part 2: Text Completion

Text 1

The process of (31) annual business taxes can be complex and time-consuming. Companies must first (32) all relevant financial information, including income statements and balance sheets. It’s crucial to (33) accurate records throughout the year to facilitate this process. Once the necessary data is compiled, businesses should review the current tax laws to ensure (34) with all regulations.

31. A. filing
    B. fining
    C. finding
    D. funding

32. A. gather
    B. garnish
    C. garner
    D. garble

33. A. maintain
    B. obtain
    C. retain
    D. sustain

34. A. compliance
    B. compliment
    C. complement
    D. complex

Text 2

Tax deductions play a crucial role in (35) a company’s taxable income. Common deductions include business expenses, depreciation, and employee benefits. However, it’s important to (36) that not all expenses are tax-deductible. Businesses should consult with tax professionals to (37) which deductions they are eligible for and how to properly claim them. Careful planning and documentation can help companies (38) their tax liability while remaining compliant with tax laws.

35. A. reducing
    B. producing
    C. inducing
    D. deducing

36. A. note
    B. notify
    C. notice
    D. notate

37. A. determine
    B. terminate
    C. germinate
    D. illuminate

38. A. minimize
    B. maximize
    C. memorize
    D. mobilize

Text 3

The timing of tax payments is an important consideration for businesses. Many companies are required to make (39) tax payments throughout the year, rather than paying one lump sum annually. These payments are typically based on (40) income and help to ensure a steady flow of revenue for the government. Failure to make these payments on time can result in (41) and interest charges. Companies should carefully (42) their cash flow to meet these obligations while maintaining sufficient working capital.

39. A. estimated
    B. estimable
    C. estimative
    D. esteem

40. A. projected
    B. projecting
    C. projectile
    D. projection

41. A. penalties
    B. penalities
    C. penuries
    D. pennies

42. A. manage
    B. maneuver
    C. mandate
    D. manipulate

Text 4

International businesses face additional complexities when filing taxes. They must navigate the tax laws of multiple countries and consider issues such as (43) pricing and foreign tax credits. It’s essential to understand the tax treaties between countries to avoid (44) taxation. Many multinational companies employ specialized tax professionals or consult with international tax firms to ensure (45) with global tax regulations. Proper planning can help businesses (46) their global tax burden while maintaining good standing with tax authorities in all jurisdictions where they operate.

43. A. transfer
    B. transit
    C. transient
    D. translate

44. A. double
    B. dual
    C. duel
    D. duet

45. A. compliance
    B. compliment
    C. complement
    D. complete

46. A. optimize
    B. optimate
    C. optime
    D. optimum

TOEIC Reading Comprehension on Business Tax Filing

Answer Key

Part 1: Incomplete Sentences

1. A
2. A
3. A
4. A
5. A
6. A
7. A
8. A
9. A
10. A
11. A
12. A
13. A
14. A
15. A
16. A
17. A
18. A
19. A
20. A
21. A
22. A
23. A
24. A
25. A
26. A
27. A
28. A
29. A
30. A

Part 2: Text Completion

31. A
32. A
33. A
34. A
35. A
36. A
37. A
38. A
39. A
40. A
41. A
42. A
43. A
44. A
45. A
46. A

This TOEIC Reading practice test focuses on understanding guidelines for filing annual business taxes, covering key aspects such as tax deductions, compliance, international tax considerations, and the importance of accurate record-keeping. The test is designed to assess vocabulary and comprehension skills related to business tax concepts, helping test-takers prepare for the actual TOEIC exam while improving their understanding of this important business topic.