Tax Returns

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The laws of Cyprus specify that tax declarations are to be submitted by a tax payer no later than 31 December of the current year; taxes are to be paid in equal instalments on 1 August, 30 September and 31 December.

The tax payable is calculated in an approximated way based on the assumed profit per year. The final tax calculation is to be made 1-2 years after the accounting year mentioned in the final tax declaration. If actual profit is 25% more than the assumed profit stated in the company’s preliminary report, the tax payer is to pay an extra 10% taken from the difference between the assumed and the actual profit.

The laws of Cyprus impose a penalty for late submission of tax reports for the current year at a rate of 5% of the amount subject to taxation. Furthermore, the overdue amount is subject to an additional 8%.

To use tax exemptions established by the laws of Cyprus for international Cypriot companies (including holding companies), one needs to observe the dates for tax report submission and the payment of taxes, as well as track changes in tax laws.