PROVISIONAL TAX RETURNS FOR THE YEAR 2023
Submission and payment deadline
According to the Cyprus Income Tax Law, all companies and self-employed who expect to have taxable income for tax year 2023 should estimate their taxable profit for the current year and pay the resulting temporary tax in two equal instalments before or on the following dates:
- 31 July 2023
- 31 December 2023
A provisional tax return may be revised by a taxpayer at any time before 31 December of the year of assessment to which it relates. In case of revision, the Commissioner of Taxation will need to be notified in writing by completing and submitting a revised provisional tax declaration.
Downward revision of the provisional taxable profit can be done only up to an amount that would create a provisional tax liability equal to the sum of payment already made up to the date of revision. This in effect would create a zero-payable instalment on the following due date of the year of assessment. Upward revision of the provisional profit creates an increased provisional tax liability. This in effect results in underpayment relating to the instalment previously paid, up to the date of revision. The underpayment needs to be settled by the following due date and it will carry interest at 2.25% per annum and a fixed penalty of 5%.
If the provisional taxable profit for 2023 is less than 75% of the final taxable profit computed based on the audited financial statements, then a 10% additional tax is added to the tax liability payable.It is noted that the final tax liability for the tax year 2023 should be settled by 1 August 2024.
Cyprus tax resident individuals (domicility is irrelevant) having income other than employment income may also need to file a provisional tax declaration in order to settle the National Health Contributions relating to such income.
We remain at your disposal should you require any further information on the matter.