CYPRUS DOUBLE TAXATION TREATY NETWORK

The following tables give a summary of the withholding taxes provided by the double tax treaties entered into by Cyprus.

Paid from Cyprus

Recieved in Cyprus

General Note:

When the treatment of withholding taxes for amounts paid from Cyprus is better under the 'non-treaty countries' regulations set out above than under the relevant treaty, the non-treaty regime will apply.

Notes:

1. In case the treaty rate is higher than that which applies for non treaty countries, the lower latter rate shall prevail.
2. In case the treaty rate is higher than that which applies for non treaty countries, the lower latter rate shall prevail.
3. In case the treaty rate is higher than that which applies for non treaty countries, the lower latter rate shall prevail.
4. Nil if paid to a Government or for export guarantee.
5. Nil on literary, dramatic, musical or artistic work.
6. Nil if paid to the Government of the other state.
   6A. A 5% withholding tax will be imposed on the dividends unless, the beneficial owner of the said dividends is a company that holds at least 10% of the share capital of the company where the said dividends have derived therefrom and he holds his ownership interest for an uninterrupted period of at least 1 year
7. For literary, artistic or scientific work, film and TV royalties, the relevant non-treaty rate applies.
8. 15 per cent if received by a company controlling less than 25 per cent of the voting power.
9. 15 per cent if received by a company controlling less than 10 per cent of the voting power.
10. Nil if paid to a Government, bank or financial institution.
11. The treaty provides for withholding taxes on dividends but Greece does not impose any withholding tax in accordance with its own legislation.
12. 5 per cent on film royalties.
13. 5 per cent if received by a company controlling less than 50 per cent of the voting power.
14. This rate applies to individual shareholders regardless of their percentage of shareholding. Companies controlling less than 10 per cent of the voting shares are also entitled to this rate.
15. 10 per cent for payments of a technical, managerial or consulting nature.
16. Treaty rate 15 per cent therefore restricted to Cyprus legislation rate.
17. 10 per cent if divided paid by a company in which the beneficial owner has invested less than US$100.000.
18. (i) 10 per cent if divided paid by a company in which the beneficial owner has invested less than ECU200.000, and
    (ii) 15 per cent if received by a company controlling less than 25 per cent of the voting power.
19. 10 per cent if received by a company controlling less than 25 per cent of the voting power.
20. 7 per cent if the interest is received from a bank.
21. 15 per cent in certain instances.
22. 10 per cent and 15 per cent in certain instances.
23. 15 per cent if received by a company controlling less than 25 per cent of the voting power.
24. It is exempt in certain instances.
25. Slovenia, Serbia and Montenegro apply the Yugoslavia/Cyprus Treaty.

EXCHANGE OF INFORMATION BETWEEN THE CYPRUS TAX AUTHORITIES AND CORRESPONDING AUTHORITIES OF FOREIGN STATES

On July 25, 2008 the Ascertainment and Collection of Taxes Law of 1978 was amended by the Ascertainment and Collection of Taxes Law of 78(I) of 2008 (the “Law”) to provide for the exchange of information relating to tax matters between Cyprus and other countries with which Cyprus has signed double tax treaties and the conditions under which such exchange can take place.

The main provisions of the Law are the following:

(a) All confidentiality privileges other than the legal privilege can be disregarded subject to the satisfaction of the conditions of the Law.

(b) The requesting foreign authority should provide the Cyprus Commissioner of Inland Revenue Department (the “Commissioner”) with specific details of the reason for the request of information.

(c) The information is not provided if the requesting State does not have corresponding enabling provisions for the provision of information in its local legislation.

(d) If the conditions in paragraphs (b) - (c) above are satisfied the Commissioner can obtain information from sources in Cyprus for the purpose of relaying same to the requesting foreign authority.

(e) Notwithstanding any other provisions or conditions set out above, the powers of the Commissioner are exercised only after the written consent of the Attorney General of the Republic has been expressly obtained on a case by case basis.
It is noted that the conditions set out in the Law described above should also be adhered to in the case of a request for exchange of information under the Cyprus – Russia Double Tax Treaty, as amended by the Protocol. link to Cyprus/Russia Tax Treaty