Preliminary tax is a payment towards your tax bill for the current year. For Income Tax self-assessment, it is normally due by 31 October, alongside any balance for the previous year. In 2026, the deadline is 18 November if you file your 2025 Form 11 and make the appropriate payments through ROS. Companies follow separate Corporation Tax rules and accounting-period deadlines. Monthly direct debit can spread preliminary Income Tax payments, but it must cover the required amount.
You budget for last year’s tax, then discover you also need to pay towards this year. That second bill is the one owners overlook. If the first you hear of it is in October, you heard too late. In a growing business, it can land just when wages, stock and other commitments are using the cash. Plan for both payments before the deadline arrives.
What is preliminary tax?
For a sole trader, or anyone else in Income Tax self-assessment, preliminary tax covers Income Tax, PRSI and USC for the current tax year. It is credited against that year’s final bill. It is a payment on account, not an extra tax.
A limited company pays preliminary Corporation Tax separately. If you also have a personal self-assessment liability, your company’s payment does not settle yours. The company rules below have different payment dates and calculation requirements.
Your first year: no payment does not mean no tax
In your first year of Income Tax self-assessment, the previous-year basis may mean no preliminary payment is required because the previous liability is normally nil. You can instead pay towards the current year’s bill. Revenue explains the first-year options.
If you make no preliminary payment, the year’s final bill still has to be paid later. Budget for it. Otherwise your first pay-and-file cycle can arrive with a balance to settle and a new preliminary payment to fund.
How to calculate preliminary tax
For preliminary Income Tax, your payment must meet at least the lowest applicable amount below. These percentages apply to the tax liability, not your sales or bank balance.
| Payment basis | Amount | What to check |
|---|---|---|
| Current year | 90% of the current year’s final liability | Your estimate must be reliable enough to meet the required amount. |
| Previous year | 100% of the previous year’s final liability | Use the liability for that year, not just its outstanding balance. |
| Year before last | 105% of that year’s liability | Available only when paying by direct debit, and not where that earlier liability was nil. |
Revenue sets out the three calculation bases. Your tax calculation needs to account for the applicable credits, reliefs and tax already deducted.
If profits have fallen, a properly calculated current-year estimate may require less cash than the previous-year basis. If profits have grown, using an earlier year’s liability may help with payment timing. It does not reduce the final tax bill. Keep the expected balance in your forecast too.
Example
Suppose your final Income Tax, PRSI and USC liability for 2025 is €30,000. You already paid €10,000 of preliminary tax for that year, leaving €20,000 to settle.
For 2026, you choose the previous-year basis: €30,000 of preliminary tax. Assume this is the lowest applicable basis and you have made no payments towards 2026 yet.
| Payment in the 2026 pay-and-file cycle | Amount |
|---|---|
| Remaining 2025 balance | €20,000 |
| Preliminary tax for 2026 | €30,000 |
| Total cash needed | €50,000 |
That is the pressure point: €50,000 leaving while the business may also be funding growth. The total is not a new tax charge. It combines the unpaid part of one year’s liability with a payment towards the next.
This is an illustration, not a client case.
When is preliminary tax due?
For Income Tax self-assessment, the ordinary deadline is 31 October. The 2026 pay-and-file cycle covers your 2025 return, any 2025 balance and preliminary tax for 2026. Revenue explains the sequence.
The 2026 deadline is 18 November 2026 if you file your 2025 Form 11 and make the appropriate payments through ROS. You must both pay and file through ROS to qualify. Doing only one through ROS does not qualify. See Revenue’s 2026 extension notice.
The monthly direct-debit scheme has its own collection schedule and conditions, explained below. The Income Tax extension does not change a company’s Corporation Tax deadline.
If you run a company
If you own a company and also pay Income Tax under self-assessment, you have two sets of payments to plan.
For a qualifying small company with a 31 December year end, preliminary Corporation Tax is due by 23 November. Your personal 2025 balance and 2026 preliminary tax are due by 18 November 2026 if you file your 2025 Form 11 and make the appropriate payments through ROS.
Take the personal example above and a company with €5,000 of preliminary Corporation Tax:
| Who pays | Payment | Amount | 2026 deadline in this illustration |
|---|---|---|---|
| You personally | Remaining 2025 Income Tax balance | €20,000 | 18 November |
| You personally | 2026 preliminary Income Tax | €30,000 | 18 November |
| Your company | Preliminary Corporation Tax | €5,000 | 23 November |
That is €50,000 from you and €5,000 from the company, five days apart. They are separate liabilities, not one €55,000 bill.
See both in your cash plan before October, not when the returns are ready.
How to pay preliminary tax in Ireland
You can pay preliminary Income Tax through ROS or myAccount, or arrange monthly direct debit through ROS. Select the correct tax and year, check the amount and keep the payment confirmation. There is no separate preliminary Income Tax return. It is a payment.
Make the tax payment part of the monthly plan
My advice is to work out the payment early and fund it through the year. For preliminary Income Tax, a monthly direct debit can make that easier.
If the required preliminary payment is €6,000 and you spread it over a full 12 months, that is €500 a month. Starting part-way through the year needs a different calculation. Check what has already been paid, the remaining collection dates and whether an additional payment is needed.
Set up or amend the mandate in the Payments Hub in ROS. Check the activity notification and collection calendar. Review the amount when your expected liability changes. Revenue’s current direct-debit guide explains the process.
The scheme pays towards the current year’s preliminary Income Tax. It does not automatically spread last year’s outstanding balance, reduce the tax due or prevent interest if you underpay. Keep the balance and the preliminary payment separate in your cash plan.
What if you cannot afford the payment?
Work out the shortfall and speak to your accountant and Revenue promptly. For an existing tax debt, ask whether a Phased Payment Arrangement is appropriate. This is different from setting up a direct debit for current-year preliminary Income Tax. A phased arrangement requires a down-payment and carries interest.
Do not assume that paying something each month means the rest can wait. The payment arrangement and the amount legally due need to be checked separately.
Small companies & short accounting periods
Budget 2027: what changes for company payments?
Budget 2027 announced a higher small-company threshold, from €200,000 to €350,000 of previous-year Corporation Tax liability, and a wider top-up route: pay at least 80% of the current year’s liability by the final preliminary instalment date, then reach 100% within four months after the accounting period ends.
The Budget document does not specify the accounting periods covered. Confirm that before using the new route. It does not change your personal Income Tax rules or reduce the company’s final bill. Put both payments in the cash plan.
Rules in Revenue’s currently published guidance
For preliminary Corporation Tax, “small company” is a tax classification, not a description of your turnover or team size. It uses a €200,000 previous-period tax-liability limit, with adjustments and exclusions that your accountant must check.
A qualifying small company’s minimum preliminary payment is the lower of 100% of the previous period’s liability or 90% of the current period’s liability. If the previous accounting period was shorter than 12 months, the previous-period liability must be annualised before using that basis. Revenue explains the calculation and first-period exception.
For a qualifying small company paying through ROS, the deadline is the earlier of 31 days before the accounting-period end and the 23rd of the month in which that day falls. A standard 31 December year-end therefore gives a 23 November preliminary deadline. Other period ends need their own calculation. Large companies may have two instalments. Revenue’s preliminary Corporation Tax manual covers the details.
A qualifying new company may have no preliminary payment for its first accounting period. That is not an exemption from the final tax. Check the conditions before relying on it.
Example: a small tech startup
This example uses Revenue’s currently published payment rules, rather than assuming the Budget proposal applies to this period.
Assume the company qualifies as small and had a full 12-month previous accounting period with Corporation Tax of €5,000. Its next period ends on 31 December 2026, with expected final Corporation Tax of €6,250.
Its preliminary payment bases are €5,000 using the previous period, or €5,625 using 90% of the current estimate. It chooses €5,000, payable by 23 November 2026.
If the final liability is €6,250, the remaining €1,250 is due with its return by 23 September 2027. September is the later balancing deadline, not the preliminary payment date. Revenue’s company payment and filing guidance explains the distinction.
The previous period is a full year, so no annualisation is needed.
Tax expertise
The useful question is not just “What is the least I can pay now?” It is “What will still be owed, when does it leave, and will the cash be there?”
Put the preliminary payment and expected balance into the same forecast as payroll, VAT, stock and other commitments. Use a realistic cash forecast, rather than assuming every sales target will be met. Up-to-date bookkeeping helps you estimate the liability and spot pressure sooner; the tax calculation still needs its own review.
Around Finance’s tax accounting support connects the return with the wider finance plan. If you run an Irish business turning over €250,000 or more and need ongoing accounting and planning support, we can help you plan the payments alongside the rest of the business.
FAQ
Self-assessed individuals and companies have separate rules. A first-year exception or nil liability can mean no preliminary payment is required. Identify which tax applies and calculate the liability before assuming a payment is due.
You make a preliminary tax payment and file the relevant annual return separately. In Income Tax pay-and-file, the Form 11 concerns the previous year; the preliminary payment concerns the current year. Select the correct tax and period when paying through ROS.
It depends on the company’s classification and accounting period. For the standard 31 December year-end small-company example above, it is 23 November. Large-company instalments and unusual period ends need separate checks.
Identify whether you need the Income Tax or Corporation Tax rules, then compare the applicable bases above. Use the correctly calculated tax liability, not turnover, and adjust a short previous company period where required.
Yes. Current records help you estimate the tax and plan the cash payment. They do not replace checking the tax calculation, payment basis and deadline.
