Embattled Cyprus Companies, Self Employed and all Employers are offered welcome relief in new legislation that offers tax saving and a payment plan to bring Social Insurance up to date. Businesses must make a written application to receive tax savings of interest and avoid legal action for social insurance arrears.
Social Insurance Expense
Since 2013 many businesses and employers have struggled to maintain social insurance up to date. Arrears quickly build up with up to 27% interest being paid on late payments. This compounds the situation for cash strapped business.
For Self employed it is particularly acute as the Social insurance office adopt a mindset that if you are self employed you must have the money to pay, and that you cannot just stop the business and get no income. High fix rate self insurance premiums quickly eat away at any struggling business.
Payment Plan for Social Insurances Arrear
New legislation allows business a chance to catch up. By making an application now those with social insurance arrears can make an arrangement that will pay monthly installments up to 54 months to bring arrears up to date. If an application is made the business will:
- choose a monthly installment up to 54 months to pay arrears
- save up to 27% interest penalty credited back to their account in proportion to payments
- no legal action will be commenced while the agreement is in force, and current action can be suspended
- for pending arrests or with seizure orders could be suspended
This is a fantastic 'clear the decks' policy that allows business to finance the cost of debt for personal and employee social insurance
Applications must be made between august and november. Without an application any arrears of social insurance will continue to receive interest penalties and legal action will proceed.
ProACT offer free review and advice to any business look for assistance and guidance of getting their cyprus business affairs back on track. Keep up to date with Expat News Register
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