Everything you Need to Know About Corporate Taxation in Cyprus
The corporate taxation rate for Cyprus is 12.5%. Certain income types are also subject to a special contribution for defense.
If you have recently set up your business entity, you should ensure that to do the following soon after incorporating:
- Register for company tax.
- Keep accounting records.
- Prepare a company tax return.
- Pay company tax by your deadline. Temporary tax is payable in two equal installments on the 31st July and 31st December of the current year, and Self-assessment tax (tax balance from the previous year) is payable on the 1st August (the following year).
- File your company tax return by your deadline. The Deadline for electronic filing is 31st March – 15 months after the end of the calendar year.
Taxable profits include the profits your company or association makes from renting and/or doing business.
Additionally a company or association is subject to Capital Gains Tax based on the provisions of the relevant law for Profit from the disposal of:
- Immovable property situated in Cyprus.
- Shares from companies whose property consists of immovable property or land situated in Cyprus.
- Shares from companies that participate in a company or companies which own immovable property situated in Cyprus and at least 50% of the market value of such shares is derived from the said property.
Income from investments (shares, rent or interest accruing from assets) is subject to a special contribution for defense, based on the provisions of the relevant Law.
If your company is based in Cyprus, it is liable to pay company tax on all its profits from Cyprus and abroad. If your company isn’t based in Cyprus however has a subsidiary or branch located there, it only owes corporate tax on profits from its activities in Cyprus.
Contact us for any assistance with taxation matters in Cyprus.