Skip to the content

Last quarter prepayments

As the end of 2018 draws near, we would like to focus your attention on the last possible installment of prepayments for this year.  This is the last chance for every company in a tax paying position who has not made sufficient prepayments to avoid a tax increase. For companies with a year ending on December, 31, the deadline for this last installment is December 20th, 2018.  To know the specific due dates for companies with a year ending on December, 30th or earlier, we recommend to contact your KPMG Tax Adviser.

General information concerning prepayments

As mentioned in earlier communications, every company in a tax paying position can prepay its CIT.  This way, a company can evade the surcharge that applies if no or not enough prepayments are made. Each tax prepayment leads to a credit, which reduces the overall CIT surcharge. We refer to our e-tax flash of March and June 2018 for further details.

Prepayments in the last quarter of 2018

For assessment year 2019 a surcharge rate of 6,75% on the tax liability of a company applies. For the first quarter a credit of 9% applies, for the second quarter 7,5%, for the third quarter the rate is 6% and for the last quarter 4,5%.

A company that hasn’t made any prepayments in financial year 2018 can still do so in the fourth quarter until December, 20th  (for companies with financial year ending December 31st). That way, the company will reduce its tax liability while benefiting from a credit of 4,5%. Note that this credit is only 50% of the credit obtained from a prepayment done in the first quarter. Nevertheless it might still be useful to avoid or mitigate the tax increase.

This can be illustrated by an example in which company A does not make any prepayments at all, and company B makes a first prepayment of 45.000 € in December. Both companies have a financial year ending December 31st.



Company A

Company B

Taxable base



Tax liability






All quarters


Fourth quarter

Surcharge : 88.740 x 6.75%



Tax credit :

4,5 % x 0

4,5% x 45.000









Also companies that have made prepayments in the previous quarters can still benefit from a last prepayment: it will decrease the tax liability of a company even more. However, given that the credit rate is lower than the rate of the tax increase, it is recommended to contact your KPMG Tax Adviser to see if these prepayments are to be recommended .  In addition , please note that a credit cannot be obtained if the prepayment is done after December 20th 2018.  

On the other hand if early 2019  the taxpayer notices that too much prepayments were made in respect of the 2018 December 31st closing  , the taxpayer could opt to have the excess prepayments either refunded or used as a tax prepayment for the 2019 financial year by means of a written request to be done ultimately within one month after receipt of the prepayments slip.

Key points

Although a tax prepayment made in the last quarter is not as beneficial as tax prepayments done in previous quarters, it can still be a valid option for companies which have done no or insufficient prepayments so far. This way, they will be able to mitigate a tax increase due to insufficient prepayments and it can ensure that the company does not need to pay a substantial amount of tax anymore when it receives its tax assessment note.

In addition it is recommended – within a specific timeframe - to reconsider early 2019 , the prepayments done in the course of the 2018 financial year upon availability of a more final view on the ultimate tax position for the 2018 financial year .

For more information, please contact your KPMG Tax Adviser or send an email to BE-FM CCP.

Connect with us

Frank Vancamp
Tax Partner

Corporate Tax

Share this


Related articles