[Podcast] Happy New Tax Year Cyprus - New Ways for Tax Returns
ProACT Sam sets out to clarify the confusing position with Cyprus Income Tax Returns due now.
Online tax registration is required for all Cyprus tax returns from 1/1/2018. this includes Individuals now as well as companies and vat businesses. You can only submit online cyprus tax returns from this date.
Unfortunately the system not ready. Currently submissions cannot be made until into May 2018 for the year 2017,
In March the Cyprus self employed online tax return 2016 deadline was extended to june 2018 from june 2017, so there is some scope for extension for 2017 returns due April 2018.
Tax due by self assessment should already have been paid for 2017, this should still be paid by before end of June 2018.
Tax Saving Review Points
- All tax registered individuals in Cyprus are now being automatically enrolled into online tax. Logins are being sent to taxpayers and their agents. These are being sent by post (not email) in mid April
- Need help registering ? contact ProACT for help and guidance
- Previous years returns can still be done, prior to 2016, but 2017 tax returns cannot yet be done. These returns will be available from May onwards.
- If you Need help submitting an online tax return, ask ProACT for help
- Cyprus Tax payment balances are still due by June 2017, avoid penalties and interest by paying on time.
Automatic Exchange of Information
Common Reporting Standards allow exchange of information of income from work, rentals and savings means the tax man knows all your income tax information
Your employer, supplier, bank or investment company may share this information with their country of tax residence and your country of tax residence.
That is why you have had to provide tax numbers to your bank and investment company over the last year.
As the UK does not deduct tax at source, you may well have a tax liability in your tax resident country. This cannot be hidden from them.
Saving Tax Could Cost You Inheritance Tax
Tax rates in Cyprus have not changed for 2017 but there is a change to the treatment the savings defence tax at up to 30%.
Expats could pay 0% tax on interest, dividends and rental income, saving 30, 17, 3% defence tax.
This was introduced in 2015 along with changes brought in with the EU Laws of Succession and changes to Wills.
Initially tax on Expat savings was not claimed nor deducted since July 2015.
However since 2017 it was decided that to secure this relief of defence tax, Expats must submit a domicile questionnaire and non domicile claim.
This is a double edged sword. Claiming relief of saving tax now, confirms you don’t have a Cyprus domicile. Therefore you are likely to retain your domicile of origin or birth. If you are British born, that means you are confirming you are liable for UK Inheritance tax of 40% on worldwide assets.
It seems that initial enthusiasm by Cyprus to offer lower tax for Expats, has a consequence that is now managed by requiring Expats to confirm their Domicile - in Cyprus and at home.
Many Expats submitted Income tax returns for 2015 and 2016 without a domicile questionnaire. If you haven’t, you should do so now, or find yourself with a saving tax assessment for 2015 and 2016 in a future assessment.
Tax Saving Review Points
If you want 30% Saving tax savings in Cyprus on World wide income then submit a Domicile Questionnaire.
There are ways that a Family or Business could avoid 40% Inheritance Tax also.
Free Review and Help for Cyprus Expats
ProACT can assist with your Cyprus online tax registration, with the know how to guide you through the online return process, or to provide an online tax return service.
Contact us for a Free Review and Assistance.
