The Process of Adjustment of Tax Arrears Law 2017 (Law 4(I)/2017) establishes a procedure for settling tax arrears by monthly instalments. It provides a waiver of interest and penalties of up to 95% for all nationally imposed taxes, including income tax, value added tax, special defence contribution tax, capital gains tax, stamp duty and special contributions payable by employees, pensioners and self-employed persons.
Although the law was enacted in February 2017, it did not take effect immediately, in order to allow time for the necessary payment systems to be put in place. The deadline for submitting applications to participate in the scheme was originally set at three months after the law took effect. The law took effect on 3 July 2017, and the deadline for submitting applications was therefore 3 October 2017.
Following previous extensions, the deadline for submitting applications was due to expire on 3 July 2018. However, it has been extended by a further six months, by Law 65(I) of 2018. Applications for inclusion in the scheme must now be made no later than 3 January 2019, and applicants must submit any pending tax returns no later than 31 December 2018.
For further information please contact Constantinos Christofi or your usual contact at Elias Neocleous & Co LLC.
