Surcharge on pvt discretionary trust

Save Share

This query is : Resolved

Quick Summary

A private discretionary trust taxed at Maximum Marginal Rate (MMR) is not automatically liable for highest surcharge. If 143(1) wrongly applies 10-15% or 37% surcharge on low income, it is a computation error. Such mistakes can be challenged through rectification or appeal; no penalty arises if income is unchanged.

Kunjan

Kunjan (Querist)

14 February 2026 143(1) levied strange 10 or 15% surcharge on pvt disc. trust having just 7 lakh interest income,

i thikn its taxed at MMR, thats y?

not sure,

Aashok Kumar Sharma online

Aashok Kumar Sharma

(Expert)

14 February 2026 Yes, private discretionary trust is taxed at MMR (30%).
But surcharge should not apply at ₹7 lakh income.
If 10% or 15% surcharge is applied, it is likely a computation or status error and can be corrected via rectification.

Message likes : 1 times

Kunjan

Kunjan (Querist)

22 March 2026 yes sir going in appeal (rectification failed).
, wrongly 143(1) levied 37% surcharge (for aop it was 15%, but pvt disc trust is not aop, its boi).
mmr does not mean surcharge also should be at max rate.

Kunjan

Kunjan (Querist)

04 April 2026 will penalty also follow ? 143(1) levied cess (income remains same).
my view - no penalty as income remains same. (Chapter XXI of the "Act" lists down the various kinds of penalties imposable,)

Kunjan

Kunjan (Querist)

08 April 2026 resolved. no penalty, but department implies MMR means surcharge also at highest rate of 37%

You need to be the querist or approved CAclub expert to take part in this query .
Click here to login now