This note provides details on how to calculate quarterly instalment payments (QIPs) for large companies.
The instalment amounts are based on the estimated corporation tax liability of the company's current accounting period. Therefore, this means that large companies will be required to forecast their tax liabilities as accurately as possible in order to avoid interest charges on underpayments. For accounting periods commencing on or after 1 April 2019, 'very large' companies will need to carry out such forecasts even earlier during the accounting period as their instalment payments must all be paid during the accounting period.
For general details regarding QIPs and determining whether a company is large or very large for this purpose, please refer to the QIPs - when do they apply? guidance note.
Estimating the company's corporation tax liability
In order to determine the company's corporation tax liability for the accounting period, it is necessary to estimate the tax that is due on the company's total taxable profits including:
- any liability under CTA 2010, s 455 (loans to participators). For further information on loans that fall within these provisions, please refer to the Loans to participators guidance note.
- amounts apportioned from controlled foreign companies (CFCs) under TIOPA 2010, s 371BC(1). For further information on CFCs, please refer to the Controlled foreign companies (CFCs) guidance note.