When calculating preliminary tax for 2011 based on 100% of the prior year tax liability, the preliminary tax payment is to be based on the final liability for the year 2010 as if the USC had been payable and as if the income levy and health levy had not been payable for that year. Revenue has now also confirmed that no other adjustment is made to the 2010 figures e.g. the 2010 tax credits are used and not the 2011 tax credits, etc.

In cases where there is also PAYE income, for the purpose of calculating the amount of preliminary tax for 2011, it is taken that the correct amount of USC would have been deducted. The PAYE income is only taken into account in determining the rate of USC to apply.

Film Relief

The preliminary tax amount for 2011 has not been adjusted to disallow any amount for this relief. The amount of the relief granted in the year 2010 must be manually added back in order to arrive at the correct amount of preliminary tax for 2011.

Transborder Relief

In eBrief No. 53/11 Revenue advises that the 2011 Preliminary Tax calculation is incorrect where there is Transborder Relief due.

Further details on the above issues are set out in Revenue's eBrief No. 53/11 available on the Revenue website www.revenue.ie.