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.