VAT Updates

New Decree changing VAT Returns and payments for certain businesses

In an effort to satisfy the increased cash-flow requirements of the Cyprus Government resulting from the COVID-19 outbreak, the Council of Ministers issued on 16 April 2020 a new Decree (ΚΔΠ 170/2020). The decree affects the VAT reporting periods and deadlines for submission and payment of VAT due by businesses which have received notifications from the Tax Department through e-mail or otherwise. The Tax Department has also published guidance on the practical application of this amendment.

 

Change in taxable periods

Taxable persons who have received the relevant notification, are required to submit VAT returns for monthly reference periods ending 31 March 2020, 30 April, 31 May and 30 June 2020. The transitional arrangements relating to the current reporting periods are summarized in the table below:

Current VAT period

New VAT period

Submission and payment deadline for the periods ending up to 31/03/2020

1/1/2020-31/3/2020

1/1/2020-31/3/2020

27/4/2020

1/2/2020-30/4/2020

1/2/2020-31/3/2020

27/4/2020

1/3/2020-31/5/2020

1/3/2020-31/3/2020

27/4/2020

Payment of the VAT liability

The deadline for each of the aforementioned periods is the 27th of the month following the expiration of each reporting period. Affected businesses whose activity codes fall within the scope of the table in the Annex below are required to make payment of the liability  relating to each reporting period in full. Affected businesses whose activity codes do not fall within the scope of the aforementioned table are required to pay 30% of the VAT liability relating to each reporting period, with the remainder falling due in accordance with the manner prescribed by the guidance from the Tax Department.

Comments

The above provisions apply only to businesses which have received notifications. The taxable periods for businesses which have not received notifications remain the same and are able to take advantage of the deferral for payment of their VAT liability. More details may be found in our previous VAT alert.  The notifications have been sent by the Tax Department to the email declared to the VAT Authorities during TAXISNet registration. Any changes to this address which have not been declared to the Tax Department will not affect the responsibility of businesses to comply with the above changes.

Annex: Table of activity codes required to make payment in full

 

Activity code

Activity description

1.

35111

Production of electricity

2.

36001

Collection and distribution of water for irrigation

3.

47111

Supermarkets and grocery stores

4.

47112

Mini markets

5.

47211

Retail sale of fruit and vegetables

6.

47221

Retail sale of meat and meat products, including poultry

7.

47241

Retail sale of bread and bakery products

8.

47242

Retail sale of confectionary products

9.

47301

Retail supply of fuel

10.

47411

Retail sale of computers, peripheral hardware and software including video games

11.

47621

Retail sale of newspapers and stationery

12.

47731

Retail sale of pharmaceuticals

13.

61101

Cyprus Telecommunications Authority (CyTA)

14.

61201

Internet services

15.

61301

Satellite services

16.

61901

Other telecommunication activities