Dear clients and associates,
In accordance with the provisions of the Special Defense Contribution (SDC) Law, a company must distribute 70% of its accounting profits by the end of the second year following the year of assessment, and where this has not been done it will be deemed to have made this distribution for SDC purposes.
The company is obliged to prepare and submit by the 31st of January 2017– the Deemed Distribution of Dividend form (I.R.623)
In the event that a company has a non-Cyprus tax resident beneficial shareholder (UBO) and a Cypriot nominee shareholder, is obliged to prepare and submit by the 31st of January 2017 the Auditor’s and Director’s declarations informing the tax authorities that the company has no obligation to distribute dividends and therefore no SDC needs to be paid.
The aforementioned obligation is serious and urgent, so as for the company to avoid any unfair taxation being imposed as a result of confusion or lack of proper consultation on the matter.