Tax Update – December 2019

Tax Update – December 2019

in Uncategorized

We would like to inform you of the below important changes in relation to Social Security and National Health System (GESY) contributions and the personal income Tax:

Social Security contributions

As from 1st January 2020 the monthly maximum insurable gross salary in respect the Social Security contributions will increase to €4.572

GESY-National Health System

As from 1st March 2020 the GESY-National Health System will increase to:

Categories March 2020
Employees 2,65%
Pensioners 2,65%
Other Income e.g. interest, dividends, rental income 2,65%
Directors 2,65%
Self Employed 4,00%
Employers 2,90%

The maximum taxable amount per individual remains at €180.000

Personal Income Tax

The House of Parliament, on the 6th of December 2019, approved an increase in the percentage of maximum allowable tax deductions in relation to life insurance, medical insurance, social security, pension fund, and provident fund contributions from 1/6 of gross income that was applicable up to 31 December 2018 to 1/5 of gross income.

The above is applicable from the 1st January 2019 (tax year 2019) onwards.

Cyprus implements the legislation of the EU Anti-Tax Avoidance Directive

Cyprus implements the legislation of the EU Anti-Tax Avoidance Directive

in 2019, 2019, Law, Tax


On the 5th of April 2019, the House of Representatives approved the proposed legislation (the Law) implementing the provisions of the European Union Anti-Tax Avoidance Directive (ATAD or Directive). The new Law will come into force once it is published in the Official Gazette of the Republic. The provisions of the Law shall be effective as of 1 January 2019 (i.e. from the tax year 2019 onwards).

The Law introduces the below:

  • Interest limitation rules
  • CFC rules
  • General Anti-abuse rule (GAAR).

The second phase of the implementation of the Directive concerning the exit taxation provisions and the Hybrid mismatch rules will be effective as of 1 January 2020.

The first implementation of the ATAD Law impacts only Cyprus Corporate Income Tax payers and more specifically Cyprus Tax Resident Companies and Cyprus Permanent Establishments (PEs) of non-Cyprus Tax Resident Companies.

For more information, please click here.

IFRS 9 – Financial Instruments

IFRS 9 – Financial Instruments

in Audit

IFRS 9 despite the wide perception actually affects not only financial institutions but much more organizations. This is the case especially when an entity has long-term loans, equity instruments or any other financial assets. Even entities with short-term receivables are also affected.

IFRS 9 can affect entities in different ways such as:

  • It increases the volatility of the presentation of the income statement. More assets than before would have to be measured at fair value with any increase or decrease in their fair value to be recognized instantly as they appear in profit and loss.
  • Entities will now have to provide for any possible future credit losses on their receivables (including trade receivables) and loans. This provision shall take place even when a receivable (e.g. loan) is recognised for the first time in the entity’s financial statements; even if the possibility of future credit loss is highly unlikely.
  • IFRS 9 also introduces new disclosure requirements that some entities will have to adopt in order to process the required data needed to be disclosed.

You can find the most significant changes introduced by IFRS 9 by clicking here.

In case you need any further clarifications or assistance on how to adopt your company to IFRS 9, please contact us at: T: +357 25443132
F: +357 25878948

Tax Calendar 2019

Tax Calendar 2019

in 2019, Tax

A useful guide for tax payment deadlines and other filing obligations for the Year 2019. For more info click here.

Social Security and National Health System (GESY)

Social Security and National Health System (GESY)

in 2019, Tax

As from the 1st of January 2019 the Social Insurance fund contributions have been increased and as from the 1st of March 2019 a new contribution will be introduced for GESY – National Health System.

For more information, please click here.


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