A. Income Tax Treatment of Forex
It is proposed that as of 1st January 2015, exchange differences, whether losses or gains, which do not relate to trading in forex, are not tax deductible or taxable respectively.
Companies specifically trading in FX Currencies, FX currency options and certain derivatives are exempted, yet, there is an option to make an irrevocable election.
B. Incentives to High Earners- Saving Plans
High Earners, the income of which exceeds EURO 100,000 can enjoy 50% exemption from personal income tax for longer.
The period of applicability is extended from five to ten years, provided that an individual was not a Cyprus tax resident for three years out of last five years, since commencement of their employment and the year immediately preceding their employment. OR (b) the bill proposes that for employments, which commenced during or after 2012 the three year period is increased to five years and that the last year for which 20% exemption will be available is 2020.
Individuals eligible for the 50% exemption cannot also claim the 20% exemption.
The amendments are proposed to be effective as from 1 January, 2015.
The above-proposed changes are aimed to positively influence the local business and in relation to individuals would attempt to encourage more high- net worth individual investors and high earners to reside and work in Cyprus.
The content of this article is intended to provide a general guide to the subject matter. Specialist advice should be sought about your specific circumstances.
