Paying Taxes in Cyprus

1. What is the corporate tax in Cyprus?

The standard corporate tax rate for companies that are registered in Cyprus is 10%, one of the lowest in Europe.

2. What is the VAT in Cyprus?

In Cyprus, the standard VAT rate is 15%, but there is a reduced rate of 8% and 5%. There are also some services and goods to which a zero VAT rate is applied.

3. How can the VAT be refunded in Cyprus?

Electronic filing for VAT refunds has been introduced, therefore one can claim a refund by submitting the application form an uploading the required invoices. The claim can be submitted to the Member State of Establishment since 1st January 2010. The deadline for filing an application in order to get a VAT refund is 30th September in the following year. The procedure will take as long as the authorities will check the eligibility for a refund.

4. What is the dividend tax in Cyprus?

The dividend tax rate in Cyprus is 15%, but there are exceptions for dividends paid to a non- resident or a resident company. In these cases, there is no dividend tax.

5. Are there any incentives for foreign investors in Cyprus?

Cyprus is very attractive for foreign investments, since it has a well-developed infrastructure and well qualified labor force. In addition to these, the tax regime with a low corporate tax and reasonable VAT rate, together with the free zone area are great incentives for foreign investors who want to come to Cyprus. 

6. Why do I need a local accountant for my business in Cyprus?

It is recommended that you have a local accountant among your employees, since he or she will be faster in solving accounting issues that may appear. Besides, a local specialist with some experience in the field will meet the system’s requirements and will provide professional accounting services for your business in Cyprus.