TEMPORARY TAX - 2024 - 2ND INSTALLMENT

We would like to remind you for the requirements of the Cyprus Tax Legislation (Assessment and Collection Law as amended in 2003, article 24) regarding the filing of temporary tax returns and relevant temporary tax payments for the year 2024.

Please note that a Temporary Tax Assessment of the estimated net taxable profit for the year 2024 (if any), should be submitted to the Tax Authorities by 31^st of July 2024. The resulting tax is payable in two equal installments as per the following deadlines:

• 1st installment: 31^st of July 2024
• 2nd installment: 31^st of December 2024

Any final resulting tax liability for the year 2024 should be settled by 31^st December 2024.

If the Company fails to do so by submitting the IR6 declarations and its operations result in a taxable profit, then the company will pay a 10% penalty on the assessed tax (thus result in an effective tax rate of 13.75% instead of 12.5%). In addition, if the estimated tax is lower than 75% of the actual tax, this 10% penalty is applicable on the difference between actual tax and temporary tax paid. If for example the estimated tax is 1.000 euros and the Company pays two equal installments of 500 euros, but the actual tax comes out to be 1.500, then there is a penalty of [1.500-1.000]*10% = 50 euros. Revision of the estimated tax is allowed only up to 31 December of the current year.

In addition, for companies that wish to proceed with Provisional Tax payments, The second installment is due by 31 December 2024 and on the second installment you can revise the tax declaration through the Tax Portal.

Where the provisional income is less than 75% of the final taxable income for the current year, 10% additional tax is applied on the difference between the final tax due and the Temporary Tax paid.

1. For tax years 2006 onwards an additional tax of 5% is imposed in the event that any tax is due is not settled within thirty (30) days of the Last Payment Date.
2. As from 1/7/2011, for all tax years, a 5% monetary fine is imposed when a person (natural or legal) omits to pay the tax due until the date stipulated in the Law or until the date stipulated in any notice by the Commissioner.

It is important to note that NIL returns need not to be submitted. The Income Tax Office however does accept the submission of NIL tax returns from individuals but not for legal entities

If you would like us to assume responsibility for the preparation of the return and administration of its submission and related payments, please get in touch with us by 11^th December 2024 to make the necessary arrangements.

Our fees for the above are:

Preparation, submission and administration of payment of the Provisional Tax return with taxable income: Euros 100- 1,000, depending on the involvement required by us for estimating taxable income.

We will consider no reply to this newsletter by 11^th December 2024 as an assumption by you of the responsibility to comply with this obligation. We do not commit to the same prices for any requests in relation to this matter after that date. We kindly request your understanding in this.