ARTICLE
15 November 2017

Settlement Of Overdue Tax Liabilities Under Process Of Adjustment Of Tax Arrears Law

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Elias Neocleous & Co LLC

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Elias Neocleous & Co LLC is the largest law firm in Cyprus and a leading firm in the South-East Mediterranean region, with a network of offices across Cyprus (Limassol, Nicosia, Paphos), Belgium (Brussels), Czech Republic (Prague), Romania (Budapest) and Ukraine (Kiev). A dynamic team of lawyers and legal experts deliver strategic legal solutions to clients operating in key industries across Europe, Asia, the Middle East, India, USA, South America, and China. The firm is renowned for its expertise and jurisdictional knowledge across a broad spectrum of practice areas, spanning all major transactional and market disciplines, while also managing the largest and most challenging cross-border assignments. It is a premier practice of choice for leading Cypriot banks and financial institutions, preeminent foreign commercial and development banks, multinational corporations, global technology firms, international law firms, private equity funds, credit agencies, and asset managers.
The Process of Adjustment of Tax Arrears Law 2017 (Law 4(I)/2017) established a procedure for settling tax arrears by monthly instalments, providing a waiver of up to 95% of interest and penalties and covering all nationally imposed taxes...
Cyprus Wealth Management

The Process of Adjustment of Tax Arrears Law 2017 (Law 4(I)/2017) established a procedure for settling tax arrears by monthly instalments, providing a waiver of up to 95% of interest and penalties and covering all nationally imposed taxes, including:

  • income tax;
  • value-added tax;
  • special defence contribution tax;
  • capital gains tax;
  • stamp duty; and
  • special contributions payable by employees, pensioners and self-employed persons.

Although the law was enacted in February 2017, it did not take effect until July 3 2017 in order to allow the necessary payment systems to be established, and applications began to be considered from that date.

The Tax Department recently issued an announcement informing taxpayers who have applied to participate in the scheme that strict compliance with the agreed terms is essential. In particular, payments must:

  • be made on or before the due date;
  • quote the unique payment reference code; and
  • constitute at least the agreed amount.

In the event of failure to comply, the penalties provided for by the law will be applied, which include the possible termination of the arrangement and the withdrawal of any waiver of interest and penalties.

Originally published by International Law Office.

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