Relevant payments include annual payments, patent royalties, certain interest payments.

Income tax payable on relevant payments is due for payment by a limited company when the preliminary tax is due and payable.

If the corporation tax liability is under €200,000 in the prior year, the Company is defined as small company.

To determine this, income tax payable is not taken into account when deciding whether a Company falls into this category.

With effect from 1st January 2013, a small Company can base its preliminary tax on either:

• 90% of the current years liability
• 100% of the prior year liability

If income tax is payable on relevant payments, 100% of the income tax due must be included with the preliminary tax  when using the 100% prior year basis.