On 19 September 2018, the Cyprus Tax Department issued an announcement regarding Country-by-Country Reporting (CbCR) obligations related to CbCR exchange relationships as follows: The Cyprus Tax Department informs all legal entities and their representatives that, constituent Entities of Cyprus Ultimate Parent Entities (UPEs) will not be subject to local filing in their jurisdiction of tax [...]

Introduction Cyprus holding companies are widely used in the context of international business structuring to optimise the channelling of inbound and outbound investments with countries that have signed a double tax treaty with Cyprus. The Tax Department recently issued a circular on the value added tax (VAT) treatment of holding companies, which aims to provide [...]

On 1 June 2018, Cyprus ratified the double tax treaty it had signed with Andorra on 18 May 2018 (the DTT). The DTT is the first double tax treaty between the two countries. Certain further legal procedures in the two countries need to take place, following which the DTT will enter into force. Once the [...]

The Cyprus House of Representatives voted on 03/11/2017 a new VAT Law, namely ‘Ο περί Φόρου Προστιθέμενης Αξίας (Τροποποιητικός) (Αρ.3) Νόμος του 2017’, (hereinafter the ‘amending law’), which amends the main VAT Law N.95(I)/2000, (hereinafter the ‘main VAT Law’). It was published in the Official Gazette of the Republic of Cyprus on 13 November 2017 [...]

The plenary session of the House unanimously approved the bill, which entitles a person to be considered a tax resident of the Republic, provided that he meets certain conditions. According to the explanatory report submitted to the House of Representatives, the law amends the Income Tax Law so that a person who does not remain [...]

The Cyprus Tax Department (CTD) has informed the Institute of Certified Public Accountants in Cyprus (ICPAC) of their intention to abolish the practice of accepting pre-agreed minimum set profit margins of 0,125% - 0,35% on intra-group and related party financing arrangements that were in the form of back-to-back loans. It is being reminded that in [...]

(ARTICLE 13 – ‘Capital Gains’ UPDATE)  Capital gains tax on Cyprus shares holding immovable property in Russia has been postponed UPDATE 29 DECEMBER 2016 In an announcement by the Cyprus ministry of finance on 29 December 2016 it is stated that an agreement has been reached between the Russian Authorities and the Cyprus authorities for [...]

Cyprus-Iran: The treaty entered into force on 5th March 2017 and will apply as from 1st January 2018. It provides for a 5% withholding tax rate on dividends paid to a company that holds directly at least 25% of the capital of the paying company, otherwise, the rate will be 10%. It also provides for a [...]

Cyprus and Luxembourg signed a tax treaty on 8 May 2017. The treaty is expected to strengthen economic ties between the two EU member states. The treaty, which is based on the OECD model treaty, provides for the following maximum withholding tax rates on dividends, interest and royalty payments: • Dividends: 0% withholding tax on [...]

Inflation in Cyprus increased to 1.5% in March 2017, from 1.4% in February and from --2.2% in March 2016, according to Eurostat, the statistical office of the European Union. Meanwhile the Euro area annual inflation was 1.5% in March 2017, down from 2.0% in February. In March 2016 the rate was 0.0%. European Union annual [...]