Provisional Tax 2021
The deadline for payment of the Temporary Tax for the year 2021, is 31 July 2021.
All companies which are Cypriot tax residents, and which expect to have taxable income for the tax year 2021, they must estimate this income and pay the temporary tax in two equal instalments before or on the following dates:
- 31 July 2021 – Payment of 1st instalment
- 31 December 2021 – Payment of 2nd instalment
It is noted that, the final tax liability for the tax year 2021 should be settled by 1 August 2022.
All companies have the right to revise their estimated taxable income at any time before 31 December 2021. If the estimated taxable income is revised upwards, 1,75% interest is payable on the difference between the revised amount payable and the amount initially declared from the due date of payment of the 1st instalment.
If the estimated tax paid for 2021, is lower than 75% of the actual tax liability calculated on the basis of the audited financial statements for the year, then a surcharge (penalty) of 10% will apply on the underestimated tax payable.
As you may appreciate, each company has responsibility to estimate its results for the tax year 2021 and proceed with a payment of temporary tax, if needed. The company is also liable for any interest or penalties which may arise due to incorrect calculations or estimations.
The Tax Department of McMillan Woods can assist you with the calculation of the expected taxable income and provide you with the steps to be taken for the payment of the taxes.
If the company does not expect to have any taxable income for the year 2021, there is no requirement to pay temporary tax.
Kindly let us know, if you would like us to assist you with the above.
In order to ensure timely preparation and submission of the relevant forms please contact our tax department before 30 June 2021.
We remain at your disposal for any further clarifications may be needed.