We would like to remind about the payment of the Defence Tax on deemed dividend distribution (DDD) on the accounting profits of the year ended 31 December 2015. The payment of the tax should be made before 31 January 2018.
The above taxes apply only to the profits of Cyprus companies that are attributable to Cypriot tax residents only. This tax do not apply to profits attributable to non-Cypriot tax residents or to Cypriot tax residents under the Non-Dom status.
The DDD provisions apply where a Cypriot company has not distributed dividends of at least 70% of its after tax profits (as adjusted for DDD purposes) within two years from the end of the tax year to which such profits relate i.e. any actual dividends paid during the year 2016 and 2017 in respect of the 2015 profits will be deducted before calculation any DDD. The tax is calculated as 17% of the DDD.
We are at your disposal to assist you with the relevant calculations as well as with the preparation and submission of the relevant tax forms.