Income-Tax Surcharge and Marginal Relief Calculator
Reviewed by Finin2min Editorial Desk · Last reviewed 11 August 2026
Estimate individual surcharge and marginal relief at ₹50 lakh, ₹1 crore, ₹2 crore and ₹5 crore thresholds.
Calculate surcharge relief
Marginal relief compares tax plus surcharge at the threshold with the excess income over that threshold.
Surcharge after marginal relief
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Tax plus surcharge and cess
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Measure
Result
Raw surcharge rate
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Marginal relief
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Relevant threshold
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How This Is Calculated
Surcharge is an additional charge on tax itself, at rates that step up as income crosses ₹50 lakh, ₹1 crore, ₹2 crore and ₹5 crore thresholds. Marginal relief ensures that crossing one of these thresholds by a small amount never leaves you worse off than staying just below it — it caps the combined tax-plus-surcharge increase to no more than the amount by which income exceeds the threshold.
Frequently Asked Questions
What are the surcharge thresholds and rates?
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Surcharge steps up at ₹50 lakh, ₹1 crore, ₹2 crore, and ₹5 crore of income, with the rate increasing at each threshold — the exact percentage at each level differs between the old and new tax regimes, and is capped differently for certain income types like capital gains.
What problem does marginal relief solve?
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Without it, earning even ₹1 more than a surcharge threshold could trigger a surcharge on your ENTIRE tax amount, making your total tax-plus-surcharge jump by far more than the ₹1 of extra income — marginal relief caps this jump so you're never worse off than someone who earned exactly at the threshold.
Does marginal relief apply at every surcharge threshold?
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Yes, marginal relief is recalculated at whichever threshold is relevant to your income level — someone just above ₹50 lakh gets relief relative to that threshold, someone just above ₹1 crore gets relief relative to the ₹1 crore threshold, and so on.
Scope: Computes income-tax surcharge and marginal relief for individuals whose total income crosses a surcharge threshold, ensuring the tax increase never exceeds the income increase beyond the threshold.
Calculation logic
Determine the applicable surcharge rate slab based on total income (surcharge rates are tiered — e.g., higher income bands attract progressively higher surcharge percentages, with a cap that applies to certain capital gains and dividend income under both regimes).
Compute tax with surcharge at the applicable rate, then compute marginal relief: if (Tax + surcharge at this slab) exceeds (Tax + surcharge at the previous slab's total income + the income excess over the previous threshold), the surcharge is reduced so total tax increase does not exceed the income increase beyond that particular threshold.
Marginal relief is computed independently at each threshold crossing (e.g., at ₹50 lakh, ₹1 crore, ₹2 crore and higher thresholds, as applicable), since a taxpayer's income can cross multiple surcharge slabs.
Inputs and assumptions
Surcharge rates, thresholds and the specific cap applicable to certain capital gains/dividend income (where a maximum surcharge rate applies regardless of the general slab for other income) follow the Finance Act provisions in force for the assessment year selected.
The new tax regime's surcharge structure and maximum rate cap can differ from the old regime — the calculator applies the correct structure for the regime selected.
Exclusions and edge cases
This calculator computes surcharge and marginal relief on total tax liability; it assumes the base income tax computation (before surcharge) has already been correctly arrived at using the Income Tax Calculator.
Marginal relief calculations at higher thresholds (₹2 crore+) apply only to specific income categories per certain provisions — the calculator applies these category-specific rules where relevant income types are entered.