Provisional tax basics for business owners

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June 20, 2026

On June 20, 2026

If you earn income that is not taxed through PAYE, such as business profits, rental income or investment income, you are probably a provisional taxpayer. Instead of paying one large bill after the tax year, you pay in instalments based on an estimate of your taxable income. Companies are generally provisional taxpayers too. Our team can help you work out whether this applies to you.

The challenge is estimating accurately. Underestimating can lead to penalties and interest, while overestimating ties up cash you could use in the business. We work with your management accounts to prepare realistic estimates before each submission and adjust them as the year develops. Planning ahead also means the payment is already budgeted when it falls due.