Provision of VAT Services in Cyprus
Accounts are prepared annually, usually for each calendar year in line with the tax year, but there is no objection to another year end date being chosen. The company’s first accounts may be prepared for any period up to 18 months. Audited accounts must be submitted to the Income Tax Department and to the Registrar of Companies within a year of the tax year-end. Accounts are required to be prepared to International Financial Reporting Standards (IFRS).
VAT in Cyprus was introduced on 1 July 1992 and it is administered by the Tax Department within the Ministry of Finance.
VAT is an indirect expenditure based tax on the consumption of goods and services. It is charged on the taxable supply of goods and services in Cyprus by a taxable person in a course of a business carried on by him. Taxable person refers to sole traders, partnerships, limited companies, clubs and associations that are making taxable supplies.
Compulsory VAT Registration
Voluntarily VAT Registration
A person may register with VAT voluntarily, provided that he is making or intending to make taxable supplies.
Exemption from registration
The VAT Return must be submitted not later than 40 days of the month following the end of the return period and the balance between the VAT output and the VAT input must be paid.
De-Registration of VAT
As from 1 January 2010 whether there is a sale of goods or provision of services in other member states enterprises are liable to submit VIES Return electronically on the 15th day following the end of each month.
If resident or non-resident companies move goods across the Cyprus national border to or from other EU countries, there may be a requirement to complete monthly Intrastat reporting.
Intrastat returns only need to be completed once the reporting thresholds are exceeded. The thresholds, which cause the obligation to make the more detailed monthly return, are currently €100,000 for Arrivals (Imports) and €55,000 for Dispatches.
Monthly Intrastats should be filed at the 10th of the month following the movements.