Estimated Tax Payments

Estimated Tax Payments are periodic advance payments made to tax authorities on income that is not subject to withholding tax — such as business profits, capital gains, rental income, or investment returns.

In jurisdictions like the UAE (especially for international income tax obligations or free zone business structures), or when investing overseas, businesses and self-employed individuals are often required to calculate and remit quarterly estimated payments to avoid penalties.

These payments are typically based on either:

• A percentage of the prior year’s tax liability

• A projected calculation of the current year’s income