TP thresholds, Tax updates, Annual levy

Learn more about the latest updates on the TP thresholds, other tax matters and the abolishment of the company annual levy.



Updated Transfer Pricing (“TP”) thresholds

The Cyprus Tax Department (“TD”) has recently increased the threshold by which taxpayers, engaging in intercompany transactions, are obliged to prepare TP documentation in the form of a Cyprus Local File.

A Cyprus Local file is not mandatory where the transactions with related parties do not exceed the thresholds of €5,000,000 in the category of financing transactions and €1,000,000 in all other categories (i.e. trade of goods/services/intellectual property/other) per year in aggregate per transaction category. Up to 31 December 2023 this exemption was granted below the threshold of €750,000 for all categories per year in aggregate per transaction category.

For more information about the TP documentation requirements in Cyprus click here

Company’s Tax Return TD4-2022

The TD has announced that the deadline for the submission of the 2022 tax return, only for companies that have an obligation to also submit a Summary Information Table for TP purposes, is extended up to 30 November 2024.

By that date (30/11/2024) these companies have to also submit their Summary Information Table through the “Tax for All (TFA)” portal.

For all other companies the deadline for submission of their 2022 tax return remains up to 31 March 2024.

Employer’s return TD7 submission process

The TD informed that for the year 2024 onwards, the submission of the TD7 will be made through the TFA portal instead of the TAXISnet system which is currently used.

Payment of SDC and GHS contributions

The payment of the Special Defence Contribution and the General Health Scheme contributions or rental payments by legal persons (codes 614 and 714 respectively), is now made in two intervals, by 30 June and by 31 December each year, instead of the monthly payments made so far.

Annual levy abolished

The annual levy imposed on companies in Cyprus, by the Registrar of Companies, is abolished as of the year 2024.

This was a fixed annual fee of €350 per company and the amount for groups of companies could reach up to a maximum of €20,000.

The abolition of this outdated measure, which initially was intended to be a temporary measure since 2011, aims at easing the burden on small businesses and at further enhancing the positive outlook of the Cyprus option towards international investors.

PGE&Co remains at your disposal for any clarifications and for further assistance that might be needed on this or on any other matter.

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