This article will review the primary tax obligations of Cypriot companies and individuals who are Cyprus tax residentsand deadlines for their performance in 2022.

Timelines for declaring and paying taxes in Cyprus in 2022

End of each month

At the end of each month in 2022, Cypriot companies are required to pay:

  • tax withheld (PAYE) deducted from the employees’ salaries during the previous month;
  • Special Defence Contribution (SDC) withheld on payments of dividends, interest and rents (where the tenant is a Cyprus Company or partnership) made to Cyprus tax residents in the previous month;
  • tax withheld on payments made to non-Cyprus residents in the previous month.

31 January 2022

  • Filing the deemed dividend distribution declaration for the year 2019 (TD623).
  • Payment of Special Defense Contribution (SDC) on deemed dividend distribution for the year 2019.

Deemed dividend distribution” for the purposes of SDC means 70% of a company’s profits after taxation that had not been distributed during two years after the end of the tax period in which they were received and that are subject to SDC at a rate of 17% (provided that the company’s shareholders are Cyprus tax resident individuals). Any actually distributed dividends reduce the base for the SDC.

  • 31.01.2022 is also a deadline for reporting required by the European Directive known as DAC6 regarding cross-border arrangements implemented between 25.06.2018 and 31.12.2021.

DAC6 is an EU Council Directive 2018/822 of 25 May 2018, providing the mandatory exchange of information in relation to reportable cross-border arrangements. It requires the “intermediaries” (particularly tax and legal consultants in the EU Member States) to disclose to tax authorities the information on cross-border arrangements developed or implemented for the benefit of their customers and bearing the hallmarks of aggressive tax planning. In the absence of intermediaries, this obligation rests directly with the taxpayers. The deadline for submitting the first DAC6 reporting in Cyprus has been postponed several times during 2021.

31 March 2022

  • Electronic submission of the 2020 corporation tax return (TD4).
  • Electronic submission of the 2020 income tax return for individuals (entrepreneurs) who must prepare audited financial statements (TD1).

Individuals must submit audited financial statements if their annual business income or income from dividends, interest, rent or royalties exceeds €70.000.

  • Payment of €350 annual fee for the year 2021 by companies (this deadline has been repeatedly postponed from 2021. In standard cases, such a deadline would have come on 30.06.2021).

31 May 2022

Electronic submission of the 2021 employer’s return (TD7).

30 June 2022

Payment of Special Defence Contribution (SDC) and General Health Contributions (GHS) on rents, dividends or interest from sources outside Cyprus for the first six months of 2022.

31 July 2022

  • Submission by companies of the 2022 provisional income tax return (TD5, TD6) and payment of the first instalment.

It is important to note that companies must assess and pay provisional tax on the estimated profit of the current year.

  • Electronic submission of the 2021 personal income tax return (TD1) by employed individuals who are not obliged to prepare audited financial statements and payment of personal income tax under the self-assessment method.

1 August 2022

Payment by companies and individuals (entrepreneurs) who must prepare audited financial statements of the final sum (balance) of tax under the self-assessment method for the year 2021.

31 December 2022

  • Submission by companies of the adjusted 2022 provisional income tax return (if necessary) and payment of the second (the last) instalment.
  • Payment of Special Defence Contribution (SDC) and General Health Contributions (GHS) on rents, dividends or interest from sources outside Cyprus for the last six months of 2022.

Fines and penalties for the late payment of tax in Cyprus in 2022

In case of non-payment of tax within the established period, penalties are charged monthly at a rate of 1.75%.

Late submission of tax returns entails a fine of €100 to €200.

Payment of tax later than the established deadline entails a fine of 5% of the amount of unpaid tax. If the tax remains unpaid within two months after the deadline, an additional fine of 5% of the outstanding amount is imposed.

Deliberate failure to pay taxes on time, tax evasion or non-withholding of taxes at the source of payment (including from salaries or payments made to non-residents) is an offence. It entails for individuals, and in the case of companies – for directors, managers or accountants, punishment in the form of a fine or imprisonment.

Important: The above information is for reference only and may not reflect a particular company’s or individual’s circumstances or real-time legislative or regulatory changes. To find out the exact list of your company’s duties to declare and pay taxes and the deadlines set for this, please get in touch with the specialists.

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