What is a good practice regarding income tax based on regulatory requirements?

Prepaying the current year's taxes in installments based on the previous year's income aligns with regulatory requirements for income tax compliance. This method is often known as "estimated tax payments." Tax authorities typically require taxpayers to make these estimated payments when they anticipate a tax liability exceeding a certain threshold. This practice aids in smoothing out cash flow for both the taxpayer and the government, ensuring that taxes are paid on time and reducing the likelihood of large tax bills at year-end that could lead to cash flow issues. Moreover, by basing the payments on last year's income, taxpayers can more accurately estimate their current year's tax obligations, especially if their income remains stable or predictably fluctuates.

This approach demonstrates an understanding of tax compliance while adhering to the regulatory requirements set forth by tax authorities, thus mitigating penalties and interest that could arise from underpayment or late payment of taxes throughout the year.