The purpose of this alert is to inform you on the recent amendments to the VAT Law, which was issued in the Official Gazette of the Republic on 9 February 2021, in the context of assisting businesses to manage their cash flow due to Covid-19.
The amendments concern Articles 45 and 46A of the VAT Act and relate to the deferral of payment of VAT due in three equal installments by 10 April 2021, 10 May 2021 and 10 June 2021 for VAT periods ending 31 December 2020 and 31 January 2021.
Deferral of VAT payments in three (3) equal installments by 10 June 2021
The deferral of payment of VAT due, only applies to periods ending on 31 December 2020 and 31 January 2021, provided that:
a) The relevant VAT returns will be timely submitted (10/2 and 10/3 respectively) and
b) Taxable persons do not fall into the categories* specified in the amending law (refer to the relevant link for more info). It is recommended that businesses confirm their economic activity code with the Tax Department to ensure whether they fall under the specified categories.
Provided that the above conditions are met and the amount due is paid in three (3) equal installments by 10 April 2021, 10 May 2021 and 10 June 2021, neither administrative penalties or interest will be levied, nor will the taxable persons be prosecuted.
How can KPMG assist?
Should you like to further discuss the content and potential impact of the Circular to your business, please contact one of our trusted advisors from the Indirect Tax Department at KPMG Cyprus.
KPMG’s Indirect Tax team provides advice and assistance at the Cyprus and international level. We structure our effort to dovetail with your business issues and strategy. Our focus is on supplying value adding and pragmatic advice rather than just a list of recommendations.
Our tax professionals are able to review your company’s current tax position and provide relevant advice and planning on a range of indirect taxes, including VAT, customs duties and excise taxes (such as tax audits, reorganizations and acquisitions, etc.). Furthermore, we can help your company with its administrative obligations and contacts with administrative bodies.