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Alerts on tax law amendments and other tax related matters are issued periodically to keep you up-to-date with the latest local tax developments.

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Amendments to the Income Tax Law for the adoption of rules against tax avoidance practices

09 April 2019

Also available in Greek

On 5 April 2019, the House of Representatives voted into law the provisions of the European Council Directive for the adoption of rules against tax avoidance practices that directly affect the functioning of the internal market (known as Anti-Tax Avoidance Directive – ATAD).

The Directive stems from the action plan against Base Erosion and Profit Shifting (BEPS), which is the result of the initiative of the G20 and the member countries of the Organization for Economic Co-operation and Development (OECD) to combat tax evasion through the transfer of profits to countries with preferential tax regimes.

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Records and supporting documentation that should be kept by employers in relation to Benefits in Kind

28 March 2019

Also available in Greek.

Tax Treatment of the Benefits in Kind (BIK)

Further to our previous tax alert dated 11 December 2018, (issue 16/2018), we would like to inform you that the Tax Department has issued Interpretative Circular 32, which clarifies the forms and supporting documentation that should be kept by the employers for each tax year and be available to be provided to the Tax Department in case requested or in case of an examination.

Links to forms: 

FORM T.D.286 A (English)
FORM T.D.286 F (English)

ΤΦ 286 Α (Greek)
ΤΦ 286 Φ (Greek)

Impact of Brexit on VAT refund claims for business expenses incurred in the UK in 2018

06 March 2019

Our Indirect Tax Alert aims to inform you of the impact that the imminent Brexit will have on the deadline for claiming refund of the VAT on business expenses incurred in the UK during 2018 in accordance with Directive 2008/09/EC (formerly 8th Directive). The Directive enables businesses established and registered for VAT purposes within the EU to request a refund of the VAT incurred on business expenses in other EU member states.

 

Tax and other incentives for the film industry

19 December 2018

On 11 December 2018, an amendment to the Income Tax Law (ITL) was published in the Official Government Gazette, providing tax incentives to companies involved in film productions.

The incentives are offered within the context of implementing a scheme approved by the Council of Ministers on 27 September 2017, aiming to attract film production companies to Cyprus. In addition to the two tax incentives provided in the ITL, the scheme provides for other (non-tax) incentives as well.

Extension of submission deadline for CbC Reports

19 December 2018

We would like to inform you that on 18 December 2018 the Cyprus Tax Department has announced that the submission deadline for Country-by-Country (“CbC”) Reports for the 2017 Reporting Fiscal Year has been extended from 31 December 2018 to 31 January 2019. The relevant announcement can be found at the Tax Department’s website.

Provisional tax for 2018 - Reminder

We would like to remind you of the upcoming deadline for the payment of the second instalment and the option to submit a revised provisional tax return for 2018.

As mentioned in our previous tax alert, the following persons have an obligation to submit a provisional tax return:

  • Individuals with taxable income other than salaries, pensions, dividends and interest (ΤD5)
  • Companies with taxable income (ΤD6)

Tax treatment of Benefits in Kind

11 December 2018

Also available in Greek.

The Tax Department has recently published an Informative Guide, in the Greek language, which explains the tax treatment of certain benefits offered by employers to employees and persons who hold or are deemed to hold an office. It is soon expected that the Informative Guide will also be issued in English in the official website of the Tax Department.

Deemed Dividend Distribution for 2018

20 November 2018

Also available in Greek

We would like to remind you of the deemed dividend distribution (DDD) provisions of the Special Contribution for the Defence Law that apply on 31 December 2018.

Tax treatment of Benefits in Kind

19 October 2018

Also available in Greek.

The Tax Department has recently published an Informative Guide, in the Greek language, which explains the tax treatment of certain benefits offered by employers to employees and persons who hold or are deemed to hold an office.

 

Reminder of the upcoming submission deadlines for CbC Reporting obligations

21 September 2018

We would like to remind you that 31st December 2018 is the submission deadline for the following Country-by-Country (“CbC”) Reporting obligations in Cyprus:

  • Submission of CbC Reports for the 2017 Reporting Fiscal Year (in respect of MNE groups which have a year end of 31 December 2017).
  • Submission of CbC Notifications for the 2018 Reporting Fiscal Year (in respect of MNE groups which have a year end of 31 December 2018).

Φορολογικές τροποποιήσεις σχετικά με τις αναδιαρθρώσεις δανείων

3 August 2018

Θα θέλαμε να σας πληροφορήσουμε ότι η Βουλή των Αντιπροσώπων ψήφισε σειρά τροποποιήσεων στους ακόλουθους νόμους:

  • Περί Φορολογίας του Εισοδήματος Νόμος
  • Περί Φορολογίας Κεφαλαιουχικών Κερδών Νόμος
  • Περί Έκτακτης Εισφοράς για την Άμυνα Νόμος
  • Περί Χαρτοσήμων Νόμος
  • Περί Κτηματολογικού και Χωρομετρικού Τμήματος Νόμος

Submission of provisional tax return for 2018

5 July 2018

Also available in Greek.

Deloitte would like to remind you that the submission deadline for the provisional tax return for 2018 is the 31st of July 2018.

Obligation to submit a provisional tax return

The following persons have an obligation to submit a provisional tax return:

  • Individuals with taxable income other than salaries, pensions, dividends and interest (ΤD5)
  • Companies with taxable income (ΤD6)

Extension to the Law Regulating the Settlement of Overdue Taxes  

4 July 2018

Also available in Greek.

On 29 June 2018, the Parliament voted for an amendment to the Law Regulating the Settlement of Overdue Taxes.

The amendment provides for a six month extension to the deadline for the submission of applications for relief from interest and penalties on overdue taxes, for tax years up to and including 2015.
 

Tax Intermediaries’ Directive enters into force on 25 June 2018

25 June 2018

On 13 March 2018, the EU Member States reached political agreement on the tax intermediaries’ directive (“the Directive”). The Directive was formally adopted by the EU Council on 25 May 2018 as an amendment to Council Directive 2011/16/EU on administrative cooperation in the field of taxation.

Deadline for the submission of personal income tax returns and final tax payment for 2017

12 June 2018

Also available in Greek.

Following a recent amendment to the Assessment and Collection of Taxes Law and a relevant notification issued in the Government Gazette, we would like to inform you that the deadline for the submission of the personal income tax returns and the final tax payment for tax year 2017 has been extended until 31 October 2018.

 

Tax Treaty signed with Andorra

4 June 2018

On 18 May 2018, Cyprus signed a tax treaty with Andorra, which was published in the Gazette on 1 June 2018. The tax treaty is based on the OECD Model Convention and provides for NIL withholding tax on dividend, interest and royalty payments.
 

Mandatory electronic payment of taxes from 1 June 2018

27 April 2018

Also available in Greek.

As part of the Government’s effort to improve the electronic services offered to taxpayers, the Tax Department has recently announced that as from the 1st of June 2018, the settlement of the following taxes can be effected only electronically through the JCCsmart website.

New tax treaty signed with the United Kingdom

3 April 2018

On 22 March 2018, Cyprus signed a new tax treaty with the UK which was published in the Gazette on 2 April 2018. The treaty is based on the OECD Model Convention. Download the alert to find out its key provisions.

Extension of the submission deadline for income tax returns for companies and self-employed individuals

23 March 2018

On 20 March 2018, the Tax Department announced the
extension of the submission deadline for corporate income tax returns (T.D.4) and income tax returns of self-employed individuals that prepare audited financial statements (T.D.1 Acc) for the year 2016, to 30 June 2018.

Greek version below:

Παράταση στην ημερομηνία υποβολής δήλωσης εισοδήματος εταιρείας και αυτοεργοδοτούμενου για το έτος 2016

Στις 20 Μαρτίου 2018, το Τμήμα Φορολογίας ανακοίνωσε την παράταση της ημερομηνίας υποβολής δήλωσης εισοδήματος εταιρείας (Τ.Φ.4) και δήλωσης εισοδήματος αυτοεργοδοτούμενου με εξελεγμένους λογαριασμούς (Τ.Φ.1 ΛΟΓ) για το φορολογικό έτος 2016, μέχρι τις 30 Ιουνίου 2018.

Supreme Court rules on VAT on provision of accommodation services under ‘commitment contracts’

7 March 2018

Also available in Greek.

On 27 September 2017, the Cyprus Supreme Court issued its decision in a case involving the application of VAT to ‘commitment contracts’ in the hotel sector where tour operators do not use all the pre-booked rooms.

Imposition of VAT on letting of immovable property – VAT Circular 220

6 March 2018

Also available in Greek.

As from 13 November 2017, Cyprus VAT at the standard rate of 19% is imposed on the letting of immovable property.

The relevant legislation was published on 13 November 2017 and on 2 January 2018 the Cyprus VAT Department released Interpretative Circular 220, which clarifies some aspects of the new law with regards to letting.
 

VAT: Imposition of VAT on transfers of building land

20 February 2018

Also available in Greek.

As from 2 January 2018, Cyprus VAT at the standard rate of 19% is imposed on certain transactions involving immovable property, including the transfer of undeveloped building land.

 

VAT: Tour Operators Margin Scheme - Interpretative Circular 223

07 February 2018

Also available in Greek.

The Cyprus Tax Department issued guidance (Interpretative Circular No. 223) on 24 January 2018 that addresses the application of the special EU Tour Operators Margin Scheme (TOMS) following the decision of the European Court of Justice (CJEU) issued on 23 September 2013. (Although the authorities intend to apply the circular with retrospective effect from 23 September 2013, the date of the CJEU decision, this may not be possible due to previously issued guidance).

 

Tax Treaty signed with Saudi Arabia

09 January 2018

On 3 January 2018, Cyprus signed a tax treaty with Saudi Arabia.

The tax treaty is based on the OECD Model Convention and its main provisions are briefly outlined in our alert.
 

Extension to the Law Regulating the Settlement of Overdue Taxes

05 January 2018

Also available in Greek.

Following our previous issue 18/2017, we would like to inform you that on the 3rd of January 2018 an amending law was published in the Official Government Gazette which extends the deadline for the submission of applications to enter the scheme for specific tax liabilities.

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