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20 October 2017
In December 2015 Cyprus's tax laws were amended to provide a temporary tax exemption for loan restructurings in order to facilitate and encourage the restructuring of non-performing loans. The amendments affected:
The amendments, which were introduced by Laws 208(I)/2015 to 215(I)/2015, took effect on December 31 2015.
A new definition of the term 'restructuring' was introduced in all of the laws, referring to the direct or indirect sale and transfer of immovable property and the transfer of rights under a sale contract deposited with the Department of Lands and Surveys between one or more borrowers, debtors or guarantors regarding the same credit facility or debt and one or more creditors, in order to reduce or repay credit facilities or loans or debts granted to borrowers with one or more licensed credit institutions operating in Cyprus.
The exemptions introduced in 2015 were intended to be valid for two years from the date on which the various amending laws entered into force and were therefore set to expire on December 31 2017.
However, Laws 131(I)/2017 to 137(I)/2017, inclusive, which were published in the Official Gazette on October 6 2017, extend the exemptions for a further two years, until December 31 2019.
For further information on this topic please contact Alexandra Spyrou at Elias Neocleous & Co LLC by telephone (+357 25 110 100) or email (firstname.lastname@example.org). The Elias Neocleous & Co LLC website can be accessed at www.neo.law.
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