All Cyprus registered companies have an obligation to file provisional income tax declaration and make the payment of the first income tax instalment by 31 July 2016, the latest, if they are in a taxable position.
What you should know for your provisional income tax declaration:
Income tax is assessed on a current year basis. For the calendar year 2016 a company is obliged to estimate its corporate tax for the year and file the provisional tax declaration by 31 July 2016. The estimated corporate tax payable is due for payment in two equal instalments: by 31 July 2016 and by 31 December 2016.
Revision of provisional income tax declaration
Following the submission of the provisional tax declaration, a Company may submit a revised declaration at any time until 31 December 2016. However, a revised provisional tax declaration may NOT result in a refund of the provisional tax already paid, until the final tax computations are filed and agreed upon with the Cyprus tax authorities.
Estimated taxable profits can be revised either upwards or downwards any time before 31st December; the date of the last provisional payment is due. A revision of the taxable profit upwards however will bear interest of 4,5% on completed months per year on the difference between the revised amount of the taxable profits and the amount paid on first instalment. A revision of the taxable profit downwards however cannot exceed the amount of provisional tax paid on the first instalment.
Interest and penalties
Please provide your tax advisor with an estimate of your taxable income for the year 2016. Your tax advisor with the assistance of your accountant will then prepare the provisional tax declaration and let you know of the amount due for the first instalment.