Personal Finance

What is Surtax?

  • Last Updated:
  • Oct 27th, 2011 9:17 am
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Banned
Oct 20, 2011
147 posts
1 upvote

What is Surtax?

Why is there an additional 6.25% surtax on all our incomes? What is it used for?

And where does CPP and EI fit in?
3 replies
Deal Addict
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Feb 1, 2005
2204 posts
227 upvotes
More information is needed to understand what you're asking about, including what province you're in.

Is it the 6.25% mentioned in this article?
http://dir.rbcinvestments.com/pictures/ ... crease.pdf

If it is, then:

1. it's not on all income, but on income that is subject to (one of) the highest marginal tax rates, and based on the current form, it's now less than 6.25% as well (the : http://www.cra-arc.gc.ca/E/pbg/tf/5006-c/5006-c-10e.pdf (specifically, Line 51). Actually, it's an extra tax that is calculated based on the tax that you pay. If you don't pay more than $4006 in tax in Ontario, then you don't pay any surtax.

2. CPP and EI does not fit into this discussion.
Deal Guru
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Dec 25, 2003
11091 posts
3504 upvotes
Vancouver
Surtax is tax on tax.

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