The Cyprus VAT Act has been amended in relation to the procedure to be followed for an appeal against an assessment issued by the Tax Department. This amendment has come into force as of 7 July 2017.
Specifically, the appeals should be submitted to the Tax Tribunal first and then to the Administrative Court, instead of to the Minister of Finance and the High Court.
The hierarchical appeals to the Tax Tribunal should be submitted within 45 days from the date of notification of the Commissioner’s decision to the applicant, for the following matters:
- VAT imposed on the supply of goods and services, the intra-community acquisition of goods or importation of goods from outside the EU;
- Input VAT which is deductible by a taxable person ;
- VAT assessment pursuant to the provisions of articles 49 and 49A;
- Issuance of VAT assessment pursuant to the provisions of article 50;
- Any guidance or additional guidance issued pursuant to paragraph 2 of part I of the Schedule One;
- Any decision taken pursuant to paragraph 1 of part I of Schedule Four.
In relation to other VAT matters such as registration or deregistration, VAT refund claims etc., taxable persons can submit their appeals to the Commissioner of Taxation.
There are three conditions which need to be fulfilled in order for the Tax Tribunal to proceed with the examination of an appeal:
- Necessary documents and evidence to support the appeal have been submitted;
- VAT returns have been submitted and VAT payable has been paid;
- Payment of the undisputed VAT amount or a provision of a guarantee to the Tax Tribunal.
The Tax Tribunal - following the examination of the hierarchical appeal - has the right to issue one of the following decisions within 12 months of the submission of the appeal:
- Cancel or validate in whole or in part the Commissioner’s decision;
- Amend the Commissioner’s decision;
- Issue a new decision replacing the Commissioner’s decision;
- Refer the case to the Commissioner giving him instructions to take specific actions.
The decision of the Tax Tribunal is issued the latest within one year from the day the appeal is submitted. The taxpayer reserves the right to submit an appeal to the Administrative Court following the final decision of the Tax Tribunal.