VAT rates in Cyprus
Value added tax (VAT)
is mandatory in Cyprus for any type of company
that provides goods or services made in Cyprus. Various VAT rates
apply according to the type of product and they are as follows: the standard rate is 19%
(increased from 18%) and the reduced rate is 9%
(increased from 8%). The standard rate applies to all goods or services that are not subject to the reduced rate, the zero rate or that are exempt from VAT altogether.
Our Cypriot company formation experts
can help you with any details about the VAT requirements
for your type of business in Cyprus
. Companies that perform import and export activities in Cyprus may be exempt from VAT under certain conditions.
Reduced VAT rates in Cyprus
The reduced rate of 9% applies for various services, mainly for those that concern the tourist sector and businesses that commercialize food and drinks. The reduced rate is available for:
- restaurant and catering services (including various type of alcoholic drinks and soft drinks);
- accommodation services (hotels, hostels, tourist lodgements and any other similar establishments);
- passenger transportation with taxis and passenger transportation with buses.
Another reduced rate of 5% applies to:
- the supply of foodstuff;
- the supply of pharmaceutical products;
- the supply of books, brochures, newspapers and other printed materials;
- the supply of liquid gas.
The list of services that are exempt from VAT in Cyprus includes:
- postal services;
- cultural services offered by non-profit organizations;
- health and welfare.
Register for VAT in Cyprus
Any individual in Cyprus or company in Cyprus that produces taxable supplies over the threshold of 15,600 euro must register for VAT at the Cyprus VAT Register. The registration can be made at the end of any month, if the value of the taxable supplies produced over the last year exceeds the threshold or at any time of the value of the produced goods is expected to exceed the said value within the following 30 days.
The regulations concerning VAT are also applicable for non-resident companies in Cyprus
if they are making taxable supplies in the country. For this purpose, non-resident companies can appoint a representative or apply for local VAT registration
. Specific conditions apply to non-resident companies that are not registered for VAT in Cyprus but supply and deliver goods from other EU countries and the value of these sales exceeds a certain amount per year. Our Cypriot company formation specialists
can help you with further details if you perform distance selling.