All businesses, including sole traders, companies, partnerships, and cooperatives, are required to remit Provisional Income Tax on dates specified by the revenue authority. Referred to as Quarterly Payment Dates (QPD), the tax returns (ITF12B) along with the associated payments fall due on:
25 March : 10%
25 June : 25%
25 September : 30%
20 December : 35%
Using your financial projections for the twelve months and hedging these against the actual performance from the beginning of the year to the respective QPD, you are to estimate your projected profit (or loss) for the year and, based on these figures, calculate the tax payable.
As a result, your annual estimated tax due is revised quarterly to give a truer representation of what you are most likely to owe in the period. Thereafter, depending on the quarter, you are to remit a specified percentage of the same along with the corresponding tax return, these as indicated above.
At the end of each year, you are required to prepare accurate financial statements for the period and submit these along with the corresponding tax return (ITF12C) on or before the 30th of April of the following year. If these show that you under-or-over-paid your income tax, you will be required to settle the balance in the case of the former, while in the case of the later it is credited to your account. These tax returns should be submitted on time regardless of whether you have anything to declare or not.
We can save you the headache of having to do all of the above by maintaining your books of accounts in order and, in so doing, being always ready and prepared to submit the requisite tax return and corresponding proof of payment on or before the due date at all times. As a result, you will never have any hassles with the tax man while your business will always be compliant and eligible for lucrative contracts and tenders. Contact Us now and we will prepare a free compliance calendar for your business and show you how we can best work together to keep your business compliant with its income tax obligations.