If these Cyprus company reporting obligations are not met, then the law provides for implications to be put in place;
- Company/Directors are liable for offenses (legal action can be taken)
- Deregistration of the company, according to the Companies Act.
- Fines/Penalties for noncompliance.
- Interest and Penalty on overdue amounts payable to the Tax authorities and/or to the Registrar of Companies.
All Cyprus Companies irrespective of size and activities are obligated to submit audited Financial Statements as per the Companies Law Cap 113.
These statements consist of;
What are Cyprus company reporting obligations?
Annual Return
Any company that conducts its business in Cyprus has a Cyprus company reporting obligation to host a General Meeting annually and file a return with the Registrar of Companies every year.
After the annual meeting, the company has 42 days to prepare and file their annual return. All newly founded companies do not have to file any documentation during the first year of their operation, on condition that the company’s first return is filed at least 18 months from its foundation.
VAT Reports
Most companies operating in Cyprus have to register with the State VAT Department in order to receive a tax number. Companies that are already registered then have to file quarterly VAT reports. This happens even if no transactions have been made during these months.
Conducting Audited Accounts
All companies that conduct business in Cyprus have a Cyprus company reporting obligation to complete financial statements in adherence to certain International Financial Reporting Standards. Some types of companies also have to appoint a locally authorized auditor that will check the company’s financial statements.
Statements have to submitted to the Registrar of Companies, along with the company’s yearly report by the end of the year.
On the grounds that, during a small business’ last financial year, they met at least two of the below requirements, small businesses are not obliged to do that;
- Their Gross assets remained below €3,400,000.
- Their Net turnover remained below €7,000,000.
- They employ no more than 50 employees.
Tax Returns
Any company that has regular income from within Cyprus and abroad is obliged to keep books and records, as well as prepare yearly records. Other companies are exempted, and allowed to file a return based on their audited financial statements.
All yearly tax returns have to be filed by the end of December of that tax year. Temporary tax returns are due by August 1 of the tax year, and there have to be paid in 3 equal installments; In the following tax year on August 1st, September 30th and December 31st. Any balances that are remaining can be paid by August 1 of the following tax year.
Payment of the Special Government Levy
Companies operating within Cyprus are obliged to pay a special government levy by the end of June every year, amounting to 350.00 Euros. For group companies, the evenly divided amount is €20,000, per company.
Failure of payment within the deadline may lead to a penalty. A 10% penalty can be paid within 60 days of the deadline, or 30% if the payment is made within 30% of the deadline. If the payment is not made after this time frame, then the Registrar removes the company from the register.
After the company has been removed from the Registrar, the company has to pay €500 within 2 years of the removal if they wish to re-instate it, and the fee raises to €750 if the previous payment is met.
If a requirement undergoes liquidation, then it is not obliged to pay the levy.
Cyprus Company FAQ
What is the corporation’s tax rate in Cyprus
The corporation tax rate in Cyprus is 12.5% standard Corporate Tax rate.
If the Company is subject to the IP Box the Corporation Tax rate is 2.5%
How much is VAT in Cyprus
The VAT in Cyprus is 19%
If you would like full list of VAT Rules and understanding please visit
VAT ON GOODS EXPLAINED
THE VAT E-COMMERCE AND MOSS EXPLAINED FROM 1ST JANUARY 2019 ONWARD
What statements does a Cyprus company need to submit for the financial audit? in the Republic of Cyprus?
- Annual Returns
- VAT Reports
- Conducting Audited Accounts
- Tax Returns
- Payment of he Special Government Levy
What conditions have to be met to not be obliged to submit the statements?
- Their Gross assets remained below €3,400,000.
- Their Net turnover remained below €7,000,000.
- They employ no more than 50 employees.
What does zero income tax mean?
Zero income tax means that less money is coming out of your paycheck each month, and when tax season c0mes around, you only have to submit a federal return.
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