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Frequently Asked Questions from Clients: The Case of Cyprus

1. What is the process regarding salary and insurance?

You can be insured as an employee of your company in two ways:

  • Employed by your company with a permanent residence outside Cyprus.

In this case, you pay social insurance to Cyprus. For example, with a net salary of €1000, you need to pay €290.30 in social insurance each month.

  • Employed by your company with a permanent residence in Greece and payment of insurance contributions within Greece (employer’s registration).

This is a special regime, and insurance is considered as that of an employee. The total contributions amount to 36.16%. In this case, the insured person is responsible. An agreement is signed between the company and you (we prepare and send it to you). When the process is complete, we go to the Social Insurance Services (EFKA) where you belong. Every month, the Single Social Security Contribution (APD) is prepared. However, any obligations that arise burden the employee, not the company.

2. I want to buy a tablet/mobile/laptop; how should the invoice be issued with or without VAT?

If the purchase is made from a Cypriot store you can buy them without VAT (according to Article 11E, regarding the purchase of mobile phones, laptops, and tablets). This is possible as long as they are purchased from any person (legal or natural, i.e., businesses, companies, freelancers, associations, organizations, unions, etc.) with an active VAT registration number, intended exclusively for professional use or the promotion of their activities.

If the purchase is made from a store in Greece, the invoice should include VAT, as otherwise, the method of transporting the product to Cyprus will be requested.

3. If a company sells to individuals within the EU, what happens?

When sales are made to individuals, the company must charge Cypriot VAT (19%). It is crucial that when sales to individuals within the EU exceed €10,000 (new pan-European limit), the company must charge and declare the VAT of the individual’s country and pay it through the One-Stop Shop (OSS). (The company has registered with the OSS).

4. When is the Income Tax submitted?

The tax return (IR4) is submitted 15 months months after the end of the tax year (e.g., the 2022 declaration must be submitted by March 31, 2024) through the Taxisnet system.

5. How is the Income Tax paid?

The tax is payable in two equal installments. The first installment must be paid by August 31st of the same year, the second by January 31st of the following year (if you wish, it is possible to pay the total amount once, thus reducing court costs). The remaining amount of tax that may arise in the audited financial statements should be paid by August 31 of the following year.

You can pay through your bank account. The banks connected to the Taxation Department are: Bank of Cyprus, Eurobank Cyprus, National Bank of Greece, Astrobank, Alpha Bank Cyprus, Ancoria Bank, RCB Bank, Hellenic Bank, Societe Generale, Societe Generale Bank. Specifically, you will enter web banking, choose Transfer&Pay -> Pay bills -> Tax payments (when making the payment, enter the taxpayer ID without the dashes).

You can send us a message on the Contact Form  or you can call at our offices in Athens   2106810690 on in Thessaloniki 2310477725 to set the date of the seminar.

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