Cyprus proceeds with pending tax rebates
An intensive effort by Cyprus’ Tax Department in recent months has resulted in rebates of over 70 million euros of excess taxes, with an additional €200 million expected to be paid, according to the head of the department, Sotiris Markides.
He emphasized that the Tax Department aims to clear all outstanding corporate and individual taxpayer rebates by the end of 2023.
As part of this project, approximately €1.5 million in income tax, Special Contributions for Defense, and Special Contributions for Employees have been cleared from individual and company income tax returns. Markides stated that the goal is to clear all corporate rebates for tax year 2021 and rebates to individuals for tax year 2022 by the end of 2023, with income tax rebates being cleared within six months of the submission deadline for each tax year.
Markides explained that the department has been using automatic cross-checks electronically and overtime work by officers during evening hours and weekends to achieve the clearance work. Priority has been given to clear corporate income tax rebates for tax year 2020, with a deadline for filing such rebates for 2021 on March 31, 2023.
Markides noted that a sampling basis was used to select rebates based on risk analysis for more audits, and some returns were left pending until examination. He also mentioned that the clearance of corporate rebates for 2020 will begin in March, and efforts are being made to clear individuals’ rebates for the 2019-2021 tax years within the next few weeks.
Markides also confirmed that the operation of the existing TAXISnet VAT system has been terminated as of Friday, and will be replaced from March 27 by the new Tax For All online database, which will initially concern value-added tax and the VIES (VAT Information Exchange System).
He added that the period until March 27 will be used for the transfer of data from TAXISnet, and that the full operation of Tax For All will be ready by the end of 2024.
The head of the Tax Department made it clear that the transition to Tax For All does not concern individual taxpayers yet, as they will continue to file their declarations through the TAXISnet system and use the tax portal. After the first stage this month, concerning VAT only, the second and third stages will concern income taxation, explained Markides.
