A single inner centromere protein (INCENP) found throughout eukaryotes modulates Aurora B kinase activity and chromosomal passenger complex (CPC) localization, which is essential for timely mitotic progression. It has been proposed that INCENP might act as a rheostat to regulate Aurora B activity through mitosis, with successively higher activity threshold levels for chromosome alignment, the spindle checkpoint, anaphase spindle transfer and finally spindle elongation and cytokinesis. It remains mechanistically unclear how this would be achieved. Here, we reveal that the urochordate, Oikopleura dioica, possesses two INCENP paralogs, which display distinct localizations and subfunctionalization in order to complete M-phase. INCENPa was localized on chromosome arms and centromeres by prometaphase, and modulated Aurora B activity to mediate H3S10/S28 phosphorylation, chromosome condensation, spindle assembly and transfer of the CPC to the central spindle. Polo-like kinase (Plk1) recruitment to CDK1 phosphorylated INCENPa was crucial for INCENPa-Aurora B enrichment on centromeres. The second paralog, INCENPb was enriched on centromeres from prometaphase, and relocated to the central spindle at anaphase onset. In the absence of INCENPa, meiotic spindles failed to form, and homologous chromosomes did not segregate. INCENPb was not required for early to mid M-phase events but became essential for the activity and localization of Aurora B on the central spindle and midbody during cytokinesis in order to allow abscission to occur. Together, our results demonstrate that INCENP paralog switching on centromeres modulates Aurora B kinase localization, thus chronologically regulating CPC functions during fast embryonic divisions in the urochordate O. dioica.