Deadline for payment of temporary tax

Deadline for payment of temporary tax

Deadline for Payment of Temporary Tax (Provisional Tax)

In accordance with Article 24 of the Assessment and Collection of Taxes Law, all companies must notify the Commissioner of Taxation of their estimated taxable income for the year by 31 July 2023, and consequently pay the estimated tax in two equal instalments as follows:

1st Instalment – 31 July 2023
2nd Instalment – 31 December 2023

You should note that:

  • The payment of the 1st instalment can be made by 31 August 2023, without any interest and penalties.
  • Non-payment of the 1st instalment on the due date attracts interest at the rate of 2.25% per annum, calculated on a monthly basis.
  • If the estimated income declared in 2023 is less than 75% of the final taxable income, as determined by the Income Tax return submitted for the year 2023 and/or as per the taxable income as assessed by the Commissioner of Taxation, then any balance of tax is subject to an additional 10% charge.
  • Revision of the original temporary tax declaration is possible until 31 December 2023, with any revised tax amounts being equally apportioned over the two instalments, thus attracting the interest of 2.25% per annum on the part which relates to the 1st instalment.
  • Under the Income Tax law, all Cyprus tax resident companies are taxed at the rate of 12.5% on their taxable income.
  • The balance of tax payable for the tax year 2023 is payable by 1 August 2024.
  • Overpaid tax is refunded (under conditions) together with interest at the applicable official interest rate set by the Minister of Finance, as of 1 January 2024.