The Process of Adjustment of Tax Arrears Law 2017 (Law 4(I)/2017) established a procedure for settling tax arrears by monthly instalments, providing a waiver of up to 95% of interest and penalties and covering 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 until July 3 2017 in order to allow the necessary payment systems to be established, and applications began to be considered from that date.
The Tax Department recently issued an announcement informing taxpayers who have applied to participate in the scheme that strict compliance with the agreed terms is essential. In particular, payments must:
- be made on or before the due date;
- quote the unique payment reference code; and
- constitute at least the agreed amount.
In the event of failure to comply, the penalties provided for by the law will be applied, which include the possible termination of the arrangement and the withdrawal of any waiver of interest and penalties.
For further information on this topic please contact Philippos Aristotelous at Elias Neocleous & Co LLC by telephone (+357 25 110 110) or email ([email protected]). The Elias Neocleous & Co LLC website can be accessed at www.neo.law.