The extra charge is an extra expense collected upon an individual or element if the pay or turnover surpasses as far as possible. It is a dynamic impose which implies it helps in taking higher duties from the wealthy who are gaining over certain money related breaking points. It is an immediate wellspring of income for the focal government and isn’t appropriated among the state treasuries.
One of the vital point to be noted here is that the extra charge is collected as a level of assessments and not of pay while charges are required on salary earned. Essentially, we can say that extra charge is a duty on assessment.
For the Financial Year 2018-19 (AY 2019-20), extra charge should be paid by the distinctive assessees under the pay impose Act 1961 as under
Individuals
For individual regardless of their age and the expense chunk, the tax charge is applicable if
| The total income exceeds Rs 50 Lakhs | At 10% of Income Tax |
| The total income exceeds Rs 1 Crore | At 15% of Income Tax |
Co-operative Society
For a co-operative society, the surcharge will apply as
| The total income is below Rs 1 Crore | NIL |
| The total income exceeds Rs 1 Crore | At 12% of Income Tax |
Association/LLP
For a Partnership Firm and Limited Liability Partnership, the surcharge will apply as
| The total income is below Rs 1 Crore | NIL |
| The total income exceeds Rs 1 Crore | At 12% of Income T |
Indian Company
For a Indian company, the surcharge will apply as
| The total income is below Rs 1 Crore | NIL |
| The total income is above Rs 1 Crore but upto Rs 10 Cr | At 7% of Income Tax |
| The total income exceeds Rs 10 Crore | At 12% of Income Tax |
Different Companies
For companies other than Domestic company, the surcharge will apply as
| The total income is below Rs 1 Crore | NIL |
| The total income is above Rs 1 Crore but upto Rs 10 Cr | At 2% of Income Tax |
| The total income exceeds Rs 10 Crore | At 5% of Income Tax |
What is the contrast among Surcharge and Cess?
Additional charge and cess are both additional duties far beyond pay assess. Be that as it may, the fundamental distinction among extra charge and cess lies in their income sharing, rates, and figuring. Based on both, we can assess the said terms as
| Revenue Sharing | Unlike Surcharge, the revenue of Cess is shared amongst both Central and State Governments |
| Calculation | The surcharge is calculated on income tax and cess is applicable to income tax + Surcharge |
| Rates | The surcharge is calculated as per differential rates as explained above in case of individuals, companies and other assessees whereas Health and Education Cess is applicable at a standard rate 4% for the Financial Year 2018-19in case of all assessees. |
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