Provisional tax is not a separate tax. It is a method of paying tax due, to ensure the taxpayer does not pay large amounts on assessment, as the tax load is spread over the relevant year of assessment. It requires the taxpayers to pay at least two amounts in advance, during the year of assessment, which are based on estimated taxable income. Final liability, however, is worked out upon assessment and the payments will be off-set against the liability for normal tax for the applicable year of assessment.

The aim is to help taxpayers meet their liabilities in the form of two payments, instead of in the form of a single, large sum on assessment. A third payment is optional after the end of the tax year, but before the issuing of the assessment.