Cyprus, Elias Neocleous & Co LLC updates

Corporate Tax

Contributed by Elias Neocleous & Co LLC
Tax measures introduced due to COVID-19
  • Cyprus
  • 01 May 2020

The government has introduced a variety of tax measures intended to help taxpayers preserve their cash flows and ease the administrative burden on them during the COVID-19 health emergency. In this regard, the deadlines for payment of indirect taxes and those pertaining to tax returns have been extended.

New double tax agreement between Cyprus and Kazakhstan
  • Cyprus
  • 13 March 2020

The Cyprus-Kazakhstan double tax treaty recently entered into force. The agreement – which is the first of its kind between the two countries and closely based on the latest Organisation for Economic Cooperation and Development Model Tax Convention framework – is to be welcomed in view of the possibilities for business, transactional work and business synergies that it may help to create between the two countries.

Tax incentives for start-ups
  • Cyprus
  • 27 September 2019

Innovation and entrepreneurship are heavily sought after by countries looking to ameliorate and modernise their economies. Cyprus is no different in this respect and has prioritised creating a vibrant landscape which addresses the needs of start-ups and their investors. The defining features of the Cypriot system are its IP box regime, notional interest deduction, alternative investment funds and various tax incentives which can be coupled with research and development and innovation.

Response to EU Anti-tax Avoidance Directive
  • Cyprus
  • 14 June 2019

The House of Representatives recently approved legislation implementing the EU Anti-tax Avoidance Directive in Cyprus with the aim of improving the resilience of the internal market against cross-border tax avoidance practices. The new legislation has once again demonstrated the government's commitment to supporting international efforts to tackle tax avoidance practices.

Issuance of tax residence certificates based on 60-day residence rule
  • Cyprus
  • 01 March 2019

The Cyprus Tax Department recently issued a circular giving guidance on the tax residence provisions for individuals introduced by Law 119(I)/2017. The circular makes clear that an individual who holds office as a director of a Cyprus tax-resident company and delegates this office to an alternate or nominee director at any time during the tax year does not qualify for Cyprus tax residence under the 60-day rule.


Litigation

Contributed by Elias Neocleous & Co LLC
First-instance courts must evaluate testimony adduced during hearings
  • Cyprus
  • 26 May 2020

In a recent appeal, the Supreme Court ruled that the first-instance court could not ignore testimony adduced during a hearing without having evaluated it. In its decision, the Supreme Court stressed that where there is a disagreement as to the substantive facts of a case, the evaluation of testimony is the cornerstone of any decision. The absence of judgement as to whether a substantial witness has told the truth will render the court's decision incomplete.

Cyprus convicted and fined for 26-year-old soldier's death
  • Cyprus
  • 05 May 2020

The European Court of Human Rights (ECHR) recently sentenced Cyprus for the death of a 26-year-old soldier. The ECHR found that the Cypriot authorities' investigation into Athanasios Nicolaou's death had infringed Article 2 of the European Convention on Human Rights. Consequently, the ECHR awarded his family €32,000 in non-pecuniary damages.

Court procedure for evicting defaulting tenants amended
  • Cyprus
  • 17 March 2020

The law on property rental in Cyprus appears to have been unfairly weighted in favour of tenants for some time, as defaulting tenants have been legally entitled to remain in a property without paying their legally due rent until the hearing of an application for recovery of possession before the Rent Control Court. However, the recent amendment of the Rent (Control) Law seeks to resolve the problem of landlords who have had to deal with such tenants.

Supreme Court rejects EAW cancellation request: appellant's individual rights not absolute
  • Cyprus
  • 07 January 2020

The Supreme Court recently rejected a Greek appellant's request for the annulment of a European arrest warrant (EAW) which had been issued against him in order to investigate alleged criminal offences. Although the court erroneously accepted the appellant's appeal of the ne bis in idem principle (ie, the prohibition of double jeopardy), it rightly concluded that Cyprus was not prevented from executing the EAW by investigating the case against the appellant.

Guarantee for faithful execution of tenancy lease agreement does not cover statutory tenancy period
  • Cyprus
  • 17 December 2019

In a recent appeal case, the Supreme Court ruled that the wording of a guarantee signed in respect of a tenancy lease agreement did not fall within the context of an explicit commitment to cover the statutory tenancy as well. Therefore, it could not be concluded that the parties intended to extend the guarantee to this form of tenancy and that the guarantor was committed to pay the rent during said period.


Shipping & Transport

Contributed by Elias Neocleous & Co LLC
Cyprus ship registry: updates on precautions for mariners in relation to COVID-19
  • Cyprus
  • 29 April 2020

The Shipping Deputy Ministry recently informed the registered owners, charterers, ship managers and representatives of Cyprus-flagged ships of a number of new circular letters issued by the International Maritime Organisation. All owners and managers of Cyprus-flagged ships are advised to take note and implement the measures contained in the circular letters and the interim advice for ship operators prepared at the request of the Directorate General for Health and Food Safety.

Shipping Deputy Ministry extends payment deadlines due to COVID-19
  • Cyprus
  • 22 April 2020

In order to support shipping companies and owners of Cyprus-flagged ships and mitigate the difficulties arising from the COVID-19 outbreak, the Shipping Deputy Ministry has extended the deadline for paying tonnage tax for Cyprus ships and the Register of Cyprus Ships annual maintenance fee to 31 May 2020. The ministry has also introduced special arrangements in order to protect public health and limit the spread of the virus.

Maritime cyber-risk management in safety management systems
  • Cyprus
  • 25 March 2020

The Shipping Deputy Ministry recently issued a circular on cyber risk which recognises the need to raise awareness of cyber-risk threats and vulnerabilities to support safe and secure shipping. 'Maritime cyber risk' refers to a measure of the extent to which a technology asset could be threatened by a potential circumstance or event, which may result in shipping-related operational, safety or security failures as a consequence of information or systems being corrupted, lost or compromised.

Tonnage tax scheme extended until 31 December 2029
  • Cyprus
  • 11 March 2020

The Shipping Deputy Ministry has issued Circular 1/2020 informing shipowners, charterers and ship managers that, following the formal assessment of the Cyprus tonnage tax scheme, the European Commission has concluded that Cyprus's relevant scheme is compatible with the internal market and in line with the Guidelines on State Aid to Maritime Transport.

Coronavirus – possible effects on contracts and precautions for mariners
  • Cyprus
  • 04 March 2020

The Deputy Ministry of Shipping recently issued a circular on measures to minimise the risks of coronavirus to seafarers, passengers and others on board ships and directed interested parties to the International Maritime Organisation's (IMO's) Circular Letter 4204, which provides additional guidance on how to minimise the risks to the maritime industry. All owners and managers of ships flying the Cyprus flag are strongly urged to promulgate the information in IMO Circular Letter 4204.


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