Obligation of Cyprus resident companies to provide information to Tax Authorities in relation to Deemed Distribution of Dividend by 31st January 2017

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 31^st 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 31^st 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.