Applying for and paying tax prepayments are not included in the Zen+ service. Apply for them in MyTax and pay them from your Holvi account. If your profit estimate or payment amounts change, update any scheduled payments.
What are tax prepayments?
A limited company pays corporation tax of 20% on its profit. Profit is calculated by deducting allowable expenses from taxable income. Salaries paid to the owner and employees are company expenses.
Tax prepayments are advance payments collected by the Tax Administration during the financial year, based on your estimated profit.
How are tax prepayments calculated?
The estimated profit is based on the previous financial year, or on an estimate made when the company starts trading. Your tax prepayments depend on this estimate.
If the estimate is too high, you will pay too much tax in advance. Although you will receive the excess as a refund, this may take time.
If your profit is likely to be significantly higher or lower than estimated, contact the Tax Administration to update your estimate.
Remember that turnover and profit are different.
Applying for tax prepayments
Apply for tax prepayments in MyTax. You can change the amount several times during the financial year. For instructions, see the Tax Administration's website: "How to apply for tax prepayments in MyTax – instructions for limited companies and other corporate customers".
Paying tax prepayments
After processing your application, the Tax Administration will display your tax prepayment decision and instalments in MyTax.
Pay each instalment by its due date. You can schedule payments in advance by selecting the payment date. We recommend choosing the day before the due date to ensure the payment arrives on time.
If your profit estimate changes, update it in MyTax and apply for new tax prepayments. Also update any scheduled payments.
We will send you a monthly income statement to help you monitor your company's profit. If it differs significantly from your MyTax estimate, update the estimate and reapply for tax prepayments.