Cyprus introduced Value Added Tax in July 1992. The rules on Cyprus VAT registrations, returns and compliance are based on European Union EU VAT Directives which Cyprus has transposed into its VAT Act. Cyprus VAT is administered by the Tax Department within the Ministry of Finance.
Foreign companies, or ‘non-resident’ traders, providing goods or services in Cyprus to local businesses or consumers may have to register their business for Cyprus VAT. They will then have to follow the Cyprus VAT compliance rules, including invoicing and VAT rates, as well as pay over any Cyprus VAT due.
Should you register for Cyprus VAT
There are a number of trading situations which typically require a foreign trader to register with the Cyprus tax authorities. These follow the broad EU VAT rules, and include:
- Importing goods into Cyprus from a non-EU country
- Transfering goods between Cyprus and other EU member states (intra-community supplies), either as sales (dispatches) or purchases (arrivals)
- Purchasing and selling goods in Cyprus
- Selling goods via the web to Cyprus consumers, subject to the Cyprus distance selling VAT registration threshold
- Goods held in warehouses as consignment stock
- Holding live exhibitions, events or training in Cyprus
- If a company is otherwise a non-VAT trader, but is receiving services in Cyprus under the EU reverse charge rule
- The self-supply of goods
Few companies need to VAT register if they are providing services to local Cyprus companies, and instead can use the Reverse Charge process. This is based on the EU 2010 VAT Package changes.
Note that providers of electronic, broadcast or telecoms services to consumers in Cyprus only have to VAT register in one EU country under the MOSS scheme to file a single return covering all 27 member states.
If you do need to VAT register, read our Cyprus VAT registration briefing to understand the requirements, including the VAT registration thresholds. You can read more about Cyprus VAT returns too.
There may be further exemptions from the requirement to VAT register in Cyprus you should consider.
Need help with your Cypriot VAT compliance?
Researching Cypriot VAT legislation is the first step to understanding your VAT compliance needs. Avalara has a range of solutions that can help your business depending on where and how you trade.
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