SVM24020 - Share Valuation Manual: Self Assessment

Payment of Tax

Under SA the obligation to pay tax is not linked to the issue of an assessment by the Revenue. Instead non-corporate taxpayers are automatically required to make two payments on account towards the tax due for any year and then a final 'balancing' payment to meet any tax still outstanding at the annual filing date for the SA tax return.

Payment Dates

The first payment is due on 31 January during the tax year in question, the second payment on the following 31 July and the final balancing payment on the following 31 January (i.e. the annual filing date for the year in question).

Payment Terms

Each payment on account should be approximately one-half of the total income tax liability for the previous year but payments may be reduced or cancelled if there are grounds for believing the tax liability of the current year will be less than the previous year. Any capital gains tax will only be included in the balancing payment.

No interim payments need be made where substantially all of the taxpayer's income is deductible at source, for example under PAYE.

Interest and Penalties

Interest is charged on any amount of tax unpaid at the due date for payment on account or as a balancing payment. Similarly, interest will generally be paid by the Revenue on any overpayments of tax.

In addition to any interest that may arise on tax paid late there is also a fixed penalty or 'surcharge' to encourage prompt payment. The surcharge is initially 5% of any payment still outstanding 28 days after the appropriate due date, rising to a maximum of 10% of the tax unpaid six months after the filing date.