- Clients are obligated to estimate the annual tax due and the appropriate percentage of tax to be paid for each quarter in order to calculate the provisional tax for each quarterly payment date (QPD). The percentages are currently set to be 10%, which will be published on the 25th of March. 25% is due to be paid by the 25th of June. 30% is due to be paid by the 25th of September.
What is QPDs?
- Quarterly Payment Dates (QPDs).
- Provisional tax payments, also referred to as tax payments, are set dates on which businesses are obligated to pay tax ahead of their annual tax return.
- The provisional tax due is based on the respective amount of estimated annual tax due.
How to calculate QPD
- Clients are obligated to estimate the annual tax due and the appropriate percentage of tax to be paid for each quarter in order to calculate the provisional tax for each quarterly payment date (QPD).
- The percentages currently are: 10% due 25th March, 25% due 25th June, 30% due 25th September, 35 percent due 20th December
- For example, the actual amount due at the quarter must be arrived at after subtracting the QPDs already paid from the amount due, e.g. a balance due at the end of the year.
- Say the estimated taxable income is = $2 375 000
- Estimated tax payable = ($2 375 000 X 25.75%) = $611 562.50
- QPDs due as at 25 June = {35% (10% +25%) of $ 611 562.50} = $214 046.88
Also it is possible to change QPDs if the estimates change during the year, adjustments can be made every quarter. To avoid paying interest, any underpayment of QPDs must be corrected as soon as it is realized during the year.
