Cyprus’s tax agency has released a number of statements regarding further value-added tax payment concessions for companies and those in the tourism sector financially impacted by the COVID-19 pandemic.
Previously, Cyprus announced aid to companies facing difficulties by allowing them to delay the payment of VAT that fell due between certain brackets earlier this year, and also by waiving any related interest and penalties as long as the VAT was paid by November 10th, 2020.
In a statement released on November 12th, the Cyprus tax agency announced that Cyprus companies may now instead pay in six equal instalments between November 2020 until April 2021.
Where a business fails to adhere to the new payment schedule, a penalty of 10% of the tax due is to be charged for late payment and interest will accrue.
The new arrangement was included in Law 147 (I) / 2020, which was published in Cyprus’s Official Gazette earlier this month. The 2021 Budget includes a proposal to lower the VAT rate provisionally for services falling in the tourism sector.
The Budget provides that a reduced rate of 5% down from the typical 9%, should apply to tourism services in the period between July 2020, until December 2020.