Is fiscal representative compulsory in Cyprus ?
Cyprus is a European Union Member State. If your business is established in another European Country appointing a tax agent or VA representative is not compulsory.
Cyprus yes REQUIRES a tax representative for non EU businesses.
When and how do you have to register for VAT as taxpayer?
Registration in Cyprus is made in two ways. The first layer is a simple identification for tax purposes : you get your TIN (Tax Indentification Number). It may be for customs needs (your business buys/sells within exempted areas or bonded warehouses, or IntraCommunity purchases. It is just as simple and limited to a Tax number.
A second layer is requested for businesses triggering « right to deduct » and this means the business is performing operations for which it has rights and duties :
– the business has to submit periodical returns to report local operations
– the business has no more access to VAT refund through transnational web portal or 13th Directive, but reports VAT on purchases directly on the form(s) (VAT 4) provided by in Cyprus like other established companies.
This « trigger » is activated when :
– you deliver goods to individual particulars in Cyprus and do not / cannot opt for the Distance Sales Threshold relief.
– you move goods from Cyprus to another State, being third country or Member state.
In most cases your VAT number in Cyprus will be similar to 12345678X.
What is the threshold for deliveries to particulars individuals in Cyprus ?
Distance selling as per art. 34 of VAT Directive (and taxable persons not entitled to deduct input tax and by non-taxable legal persons as per art. 3(2)(a) of the VAT Directive) :EUR 35,000
EUR 160,000 (acq. exempted pers.)
Once registered for VAT with right to deduct, which VAT should your business apply in Cyprus ?
Standard VAT rate in Cyprus is 19%, while intermediate rate is -. On the other hand, reduced rate is 5% or 9%.
Application of Article 37 and 109 to 122 of the VAT Directive in Cyprus : zero-rated; exempt
Please note that we open access to a detailed table of VAT rates per goods and services in Cyprus :
See our section https://becompliant.tax/vat-rates-cyprus
What is the scope of a fiscal representative in Cyprus?
Fiscal representative should always diagnose your operations in Cyprus and establish clearly and by written :
1- What your transactions are
2- Where your transactions must be reported : territoriality
3- what are your liabilities in the reporting territory : VAT? ECSL? Intrastat?
4- what are the conditions in which you must charge or exempt VAT in your invoices
5- provide you with a reporting agenda
What form for VAT returns and when to submit in Cyprus ?
Your fiscal representative in Cyprus will have to submit periodically on your behalf.
The VAT form you are expected to submit in Cyprus : VAT 4
In Cyprus, the periodicity of VAT is as follows :
Quarterly VAT returns in Cyprus are due 10th day of the second month following accounting period, by default
Your VAT payment is due : Same as return.
What are the E/ICSL a fiscal representative submits in Cyprus ?
The ECSL you are expected to submit in Cyprus : Intrastat 1.1 / 1.2 (by 10th day of the following month)
Your statistical declarations (Intrastat) in Cyprus : IVIES1 / VIES2 (by the 15th day of the following month
What are the late registration penalties in Cyprus ?
A one-off penalty of EUR51 per VAT return is charged for the late submission of the VAT return. Late payment of outstanding VAT results in the imposition of a penalty of 10% of the outstanding amount. Interest is charged at the rate of 3.5% annually on the amount of VAT outstanding. The 3.5% interest rate applies to the late payment of VAT, late registration, and late submission of the VAT return. The interest rate does not fluctuate.
Penalties are also assessed for the following offenses:
Late registration: a penalty of EUR85 for each month that the failure continues
Failure to apply the reverse charge: a penalty of EUR85
Failure to keep records for a prescribed period: a penalty of EUR341
Issuing an unauthorized invoice: a penalty of EUR85
Fraudulent evasion of VAT: up to three years’ imprisonment or a fine up to three times the amount due, or both
Receipt of goods on which VAT was evaded: up to 12 months’ imprisonment or a fine of EUR8,543, or both
VAT shown in assessments issued by the VAT Commissioner and not paid: up to 12 months’ imprisonment or a fine of EUR8,543, or both
Where to find official information about VAT in Cyprus
Cyprus transposed the European Directive into national regulation The Value Added Tax Laws of 2000 to 2011.
The Revenue administration responsible for VAT in Cyprus is :
Tax Department, Indirect Taxation (http://www.mof.gov.cy/mof/vat/vat.nsf/dmlindex_gr/dmlindex_gr?opendocument).
VAT and INTRASTAT compliance in Cyprus
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