Cyprus: Effective date of tour operators’ margin scheme (court decision)

A case concerning effective date of tour operators’ margin scheme

A case concerning effective date of tour operators’ margin scheme

The tax tribunal—in a case concerning the effective date of the tour operators’ margin scheme (TOMS) for business-to-business (B2B) transactions—held that the TOMS for B2B transactions applies as from 24 January 2018 (the date when Circular 223 was issued) and not retroactively as asserted by the tax authorities.

The case is: Green Greece Go Travel Ltd. (case no. 5/2020E, August 2021)

Summary

The Cypriot tax authorities (in March 2020) made a value added tax (VAT) assessment against the taxpayer for failing to apply the TOMS for B2B transactions for the period 1 February 2016 through 31 August 2019.

The taxpayer did not challenge the VAT treatment, but challenged the proposed retroactive application of the TOMS. 

The tax tribunal held that the effective date was 24 January 2018 when Circular 223 was issued.

Read a September 2021 report prepared by the KPMG member firm in Cyprus

 

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