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The Tax Department issued an announcement earlier this week in relation to the reinstatement of quarterly reporting periods and the payment of VAT for the period ending 31/05/2020.

The recent VAT payment deferral arrangements were a welcome concession for businesses in the early stages of the coronavirus pandemic.

Following on with the most recent measures announced by the Minister of Finance in support of the Cyprus economy, the Council of Ministers has issued a new Decree (Κ.Δ.Π. 268/2020) on 23/6/2020. This decision effectively reduces the applicable VAT rate for certain services relating to the tourism industry, from 9% to 5%.

A government bill passed, to offer tax credits to landlords as an incentive to lower rents to help tenants who find themselves in financial difficulty due to lockdown against COVID-19.

Further to our previous VAT Alert regarding the amendments of the VAT reporting periods and payment deadlines for certain businesses who have received notifications from the Tax Department pursuant to Decree ΚΔΠ 170/2020, the Tax Department issued an updated announcement on 21/4/2020, in order to provide the following clarification:

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 Ministry of Finance has issued an announcement declaring that the Decree will not be brought into effect.

On 2 April 2020, the Council of Ministers issued a Decree requiring certain categories of taxpayers to make advanced VAT payments.

Following our alert issued on 18 March 2020, we note that the House of Representatives proceeded with the approval of the relevant Tax and VAT legislations on Friday 27th March 2020 in response to the COVID-19 outbreak. These amendments were announced in the Government Gazette and include a number of Tax deferral concessions, an overview of which is provided below.

In response to the World Health Organisation (WHO) declaring the spread of COVID-19 as a pandemic, the Cyprus Government announced a number of actions in order to support the country’s economy, including the following business related measures.

On 3/2/2020 the Cyprus Tax Department issued a series of announcements in relation to Brexit and its impact on the application of the EU VAT refunds procedure, VIES, MOSS and Intrastat reporting.

On 14 February 2020, the House of Representatives has voted for an amendment to the Law which relates to the Settlement of Overdue Taxes Scheme and provides significant reliefs on interest and penalties on overdue taxes, including income tax, VAT, special defence contribution tax, capital gains tax and stamp duty, through the Government Gateway Portal "Ariadne".

This article summarises some of the planning strategies that companies should be considering before and after US tax reform is effective