Provisional tax declaration for tax year 2022
The Tax Department of Nexia Poyiadjis would like to remind its clients and business associates that the payment deadline of the 1st instalment of the provisional tax declaration, where applicable, for the tax year 2022 is the 31st July 2022.
General information on the 2022 provisional tax declaration
For the calendar year 2022, a company or a self-employed individual is obliged to estimate its income tax liability for the year and pay such income tax liability in two equal instalments, the first one by 31st July 2022, and the second and final one by 31st December 2022.
The statutory deadlines as per the law are 31st July 2022 and 31st December 2022, but the relevant instalment payments can be made by 31st August 2022 and 31st January 2023 respectively without any interest and/or penalty charges.
The payments for both instalments can only be done electronically, either via JCCsmart.com or via internet banking using the payment reference number that can be created via the online Tax Portal of the Tax Department (https://taxportal.mof.gov.cy).
Please note that legal entities and self-employed individuals with no estimated taxable income are not obliged to pay provisional tax.
Revision of the provisional tax calculation
Following the payment of the 1st instalment, a company/individual can revise, either upwards or downwards, its estimated taxable profits at any time until 31 December 2022 depending on its anticipated results for the year.
Interest and penalties
If a company or self-employed individual fails to make the relevant instalment payment by the dates indicated above, there is interest on the tax instalment due at 1,75% per annum which is calculated on a monthly basis (e.g. if the 1st instalment payment is not made by the 31st August 2022, there is interest of 1,75% times 1/12 if the payment is, say, delayed for one month). If the delay relates to the payment of the 2nd instalment, then in addition to the above interest charge there will be a one-off penalty of 5%.
Additional tax of 10%
If the provisional tax declared is proven to be less than 75% of the actual tax payable to be derived from the actual 2022 income tax return to be submitted to the Cyprus tax authorities, a 10% additional tax will be imposed on the net tax payable.
Information requested by our firm
The information required by our firm in order to assist you with the preparation and submission of the aforementioned declaration is:
1. Estimated income for the company or self employed individual for the year 2022 from trading / consulting / other activities, interest income, royalty income etc.
2. Total estimated expenses for the year 2022 in order to arrive at the resulting net estimated profit or loss for the year.
3. Any estimated foreign withholding / income tax paid / to be paid by the company upon the receipt of certain types of income.
We are at your disposal to assist you with the calculation of the provisional tax and the administration of the provisional tax payments and in such a case, please provide us with the information requested at your earliest convenience
For further information, please do not hesitate to contact us at email@example.com or any of the following contacts: