Proposed relief from monetary penalties or interest with regard to value added tax
Relief measures that would be offered in response to the coronavirus
The Ministry of Finance on 6 May 2021 announced its intention of submitting a bill that would provide relief from monetary penalties or interest with regard to value added tax (VAT) amounts payable in May, June, and July 2021—relief measures that would be offered in response to the coronavirus (COVID-19) pandemic.
For the proposed relief, VAT returns for these periods would need to be timely filed.
The penalty relief would not apply with regard to amounts of VAT payable in August, September, and October 2021.
The proposed relief is pending a vote, and it appears that the measure could not be voted on before 10 May 2021 when a VAT payment would otherwise be due. However, tax professionals have observed that eligible persons may be able to benefit from the payment deferral, as long as they timely submit their VAT return (assuming a later vote on the bill). Also, the relief would not cover taxable persons with activities in certain specified categories.
Read a May 2021 report prepared by the KPMG member firm in Cyprus
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