define provisional tax
TÄke tÄrewa. Provisional tax is not a separate tax but a way of paying your income tax as the income is received through the year. You pay instalments of income tax during the year, based on what you expect your tax bill to be.he amount of provisional tax you pay is then deducted from your tax bill at the end of the year. If you had income tax of more than $2,500 to pay at the end of any tax year you may have to pay provisional tax for the following year. Watch our short video on income and provisional tax.