VAT compliance and reporting rules in Cyprus 2025

Different goods and services in Cyprus are divided into 5 categories, each of which is taxed at a different VAT rate. 19% is the main Cyprus rate for Value Added Tax. All goods and services that do not fall into the other 4 categories are taxed at 19%.

  Reduced Rates:

• 9% – services for the provision of temporary accommodation (hotels, tourist lodgings, etc.), food services (restaurants, catering), passenger transport (taxis, buses, maritime transport), as well as goods and services provided by retirement homes.

• 5% – printed publications (books, newspapers, magazines), housing for permanent residence, tourism-related goods and services (until 10 January 2021), bus transport, cultural and sports events, medicines and vaccines, beverages (water, juice, alcohol), fertilizers and insecticides, animal feed, confectionery products, hairdressing and cosmetic services, funeral services.

• 0% – supply, lease, and repair of maritime and air transport, international passenger transport, export of goods outside the EU and related services, supply of goods and intangible services to tax payers in the EU or to recipients outside the EU.

To make sure which category your product or service falls into, you can check the full list here.

You can calculate the Value Added Tax amount using the following link: VAT calculator

  The difference between "0% rate" and "exemption" is that if a person or company sells a product from the 0% category, they are entitled to a VAT refund on the costs associated with the production of that product. If the goods are exempt from, then no refund is possible.

Thresholds for VAT registration in Cyprus and who is obliged to register

Thresholds for local and foreign companies. 

 Applying  for Value Added Tax purposes is mandatory if a business entity carries out taxable activities, has a fixed place of business in Cyprus and sells goods or services to customers who are physically present in the territory of the Republic of Cyprus. In addition, if the income of such a business entity (not profit, but income) exceeds EUR 15,600 (for individuals, the threshold is set at EUR 19,500) in any consecutive 12 months, there is a direct obligation to register as a VAT payer.

Value Added Tax in Cyprus: Mandatory vs. Voluntary Registration

Individuals or legal entities that have a permanent establishment in Cyprus and make taxable supplies may register as Value Added Tax payers even if the value of such supplies does not exceed the threshold for mandatory enrollment. 

How to register for VAT in Cyprus

Registration as a VAT payer in Cyprus and required documents 

It is allowed to register in person at the regional tax office or to send the relevant documents by e-mail. To register, you need to submit form TФ 1101. In addition, the following documents must be submitted along with this form:

 ❖ Certificate of registration as a VAT payer in another EU country, if available ❖ Articles of association of the company ❖ Memorandum of association ❖ Copies of IDs or passports of directors ❖ Proof that the value of taxable supplies exceeded the enrollment threshold

A business that is obliged to register must apply for enrollment within 30 days of becoming obliged to do so. In order to register a non-resident individual as a value added tax payer in, the standard procedure applicable to both residents and non-residents must be followed. First of all, such a person must be registered in the Cyprus Tax Registry. Only then can an application be submitted. Becoming VAT payer is carried out by submitting the TФ 1101 form in paper form to the relevant Regional Tax Office. If a person has already submitted an electronic application for registration in the Tax Register but has not yet received a tax identification number (TIN), he or she may still submit Form TФ 1101 - in this case, the enrollment number of the case in the format [REGXXX], provided after electronic submission, must be indicated in the form. It is worth noting that official sources do not specify a separate list of additional documents for non-residents, so the procedure for them is the same as for citizens or residents of Cyprus, subject to prior  in the system.

Fiscal representative for companies from outside the EU In Cyprus, it is possible to hire a fiscal representative, who is usually hired for VAT registration and tax compliance purposes. Such an agent can assist with filing returns in Cyprus, obtaining refunds, applying for VAT exemptions, etc. In the case of non-EU companies, a financial representative can register as a tax payer on behalf of the company. If the company is engaged in one of the activities listed below, it needs to obtain a VAT number and may appoint a financial representative in Cyprus: ❖ export of goods from Cyprus to non-EU countries ❖ import of goods from EU countries ❖ business-to-business (B2B) supplies of goods to EU countries ❖ supply of goods and services to individuals in Cyprus under the business-to-customer (B2C) scheme

It is important to note that a fiscal representative is jointly and severally liable with the taxpayer for any violation of the VAT legislation. In addition, in certain cases, the tax authorities may require the appointment of a VAT representative for a person who is not registered in the EU, does not have a permanent residence or fixed place of business in Cyprus, or if the person is an individual who has his or her "habitual residence" outside Cyprus, in the case of taxable supplies or intra-European purchases in Cyprus.

Deadlines for filing reports and paying VAT in Cyprus

Frequency of filing (quarterly/monthly), deadlines for filing and payment  After becoming a value-added tax payer, there is an obligation to submit reports on a quarterly basis (every 3 months). Reports must be submitted within 40 days after the end of the last month of the quarter to file the report and pay the tax due. VAT forms ( are available in Greek only. A taxpayer may reclaim tax on purchases of goods up to 3 years prior to the date of registration (if the goods have not been used before this date) and up to 6 months prior to the date of obtaining VAT number for purchases of services.

Penalties for late submission of VAT

Violation of registration and delays: ❖ The penalty for late enrollment  is EUR 85 for each month of delay (Article 45 of the VAT Law)

Incorrect or incomplete VAT reports  ❖ The Tax Commissioner may independently assess the amount of tax payable if the taxpayer fails to comply with the requirements and submits incorrect or incomplete reports (Article 49 of the VAT Law)

Violation of obligations regarding bookkeeping and invoicing ❖ The fine for failure to keep records is €341.72 (Article 45 of the Cyprus VAT Law) ❖ The penalty for incorrectly issued invoices is EUR 85 (Article 45 of the Cyprus VAT Law)

Late payment or non-payment ❖ The penalty for late or non-payment of Value Added Tax is 10% of the amount payable plus annual interest (at a rate determined by an annual order of the Minister of Finance - more information is available here) on the tax amount, including the penalty (Article 45 of the Cyprus VAT Law)

VIES reporting requirements for Cyprus companies

What is VIES and who is required to submit it?

VIES is a system for the exchange of information on value added tax between the member states of the European Union within the framework of administrative cooperation. The exchange of information covers data on registration in the VAT register, as well as information received from registered persons supplying goods or services within the EU. 

The VIES information exchange system is an important tool for companies trading in the European Union. It allows companies to check the status of their suppliers and customers' VAT registration in other EU member states. 

Businesses in Cyprus that conduct transactions within the EU are required to register with the VIES system for proper VAT declaration and reporting. VIES administration in Cyprus is governed by the Value Added Tax Law of 2000 (95(I)/2000), which is harmonized with the EU VAT Directive (Council Directive 2006/112/EC). Additionally, Council Regulation (EU) No. 904/2010 on administrative cooperation and the fight against fraud in the field of value added tax applies, which also applies to reporting obligations under VIES.

Monthly filing deadlines In accordance with the VIES filing rules, a Cyprus company is required to file a tax return (the so-called "Recapitulative Statement") on a monthly basis, which must indicate: ❖ the total amounts sold to EU counterparties ❖ valid VAT number of each counterparty The deadline for submitting the monthly VIES summary statement is 15 days after the end of the month. For example, a company's sales during January must be declared no later than February 15. However, if the 15th day falls on a weekend or holiday, the VIES return can be submitted on the next business day.

Format and penalties  In Cyprus, VIES (Recapitulative Statements) reports are submitted only in electronic format through the official Taxisnet portal of the Cyprus Tax Authority. As can be seen from the above, Cypriot law regulates the obligation to file VIES reports in sufficient detail. 

However, it also establishes certain penalties for violation of the legal provisions on the obligation to submit VIES reports: ❖ Failure to submit the monthly summary statement on time results in a fine of EUR 50 (for each missed monthly declaration). ❖ Corrections of errors in the VIES return are allowed up to 1 month after the return is submitted. If the correction is made later than 1 month, a fine of EUR 15 is imposed. ❖ According to the official position of the Cyprus Tax Authority, persistent failure to file VIES returns is a criminal offense punishable by a fine of up to EUR 850.

Tips for VAT compliance and common mistakes

  VAT Cyprus: common mistakes Common mistakes in Cyprus proper reporting and discharge of VAT registration requirements in Cyprus plays the important role of ensuring the financial fitness and legal standing of business. By being precise in terms of VAT returns, one is not likely to make any errors in declaring the right amount of VAT to submit and pay it accurately without incurring unnecessary costs in the form of penalties The most ordinary misconceptions regarding the VAT reporting requirements in Cyprus are:

•  Calculation errors: 

  • Listed under this category are errors that could result out of calculating the wrong rates of VAT 

• Filing incorrect VAT returns 

  • Most of the time companies are not accurately declaring input VAT, this leads to overstatement of the amount of VAT to be declared

• Mismatching of the generated sales on basis of purchases and purchases as basis of sales

  • It may be a failure to account taxable sales, a failure to account purchases as zero-rated supplies or exempt supplies or a failure to report the value of a transaction

•  Inaccurate data on the invoices

  •  An error in the information of the invoice can result in differences in reporting VAT,  e.g. a VAT registration number, incorrect amount or date of the invoice.

Format of the VAT number in Cyprus and checking its validity

How to check Cyprus VAT number?

  The format of the VAT number in Cyprus (country code CY): CY99999999L. The number consists of 9 characters: ➢ the first 8 are numbers (e.g., 12345678) ➢ the letter at the end is used as a check character, which is calculated by a special algorithm to verify the validity of the VAT number.

You can check the validity of a number by following the link on the official website of the European Commission. To check the VAT number on the European Commission website:

1. Open the this page.

2. Select the country to which the number belongs.

3. Enter the number without the country prefix (or as required by the form).

4. Click the "Verify" button.

5. You will get the result — whether the number is valid in the database of the EU tax.