Issue of Tax Ruling

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1. Fees for the issue of Tax Rulings

(a) As from 16 May 16 2016 all requests submitted for the issue of tax rulings are subject to fees (payment is made only through the JCC Smart website with code 911) as follows:

• € 1,000 for tax ruling without accelerating the application

• € 2,000 for tax ruling with accelerating the application

The issue of tax ruling with acceleration will be issued within 21 working days and without acceleration will be issued in chronological order by date of the request.

(b) requests for decision / certificate from the Tax Department for which there is an obligation under the Law for their submission, they are not subject to charge and submitted to the district offices.

2. Additional information and the process to submit the request to the Tax Department

The request for the issue of tax ruling should be submitted with the form T.F. 219/2016 along with the receipt of the payment of the fee and the letter with the figures, the detailed facts, opinions and the taxpayer’s request only online at the address taxruling@tax.mof.gov.cy as follows:

The T.F. form 219/2016 which will be uploaded on the Tax Department’s website, will be submitted after having attached the letter, the request and the receipt in PDF format as one file.
In addition, to the same email an identical copy of T.F 219 in word format but without the attachments should be uploaded.

3. Advance cross border ruling

Cross-border may be described as any agreement, disclosure or any other means or action with similar results concerning the interpretation or application of legislative or administrative action on the enforcement of laws in taxation and satisfy the three following conditions:

• It is issued, amended or renewed for a person or group of persons and which has / have the right to invoke; and

• It refers to cross-border transactions or to the question whether the activities performed by a person in another country, create a permanent establishment; and

• it is issued before the transactions or activities to another country which may create a permanent establishment or issued prior to the submission of the tax return for the period in which the transaction or series of transactions, activities.

‘Cross-border transaction’ means a transaction or series of transactions where:

a) not all parties have their tax residence in the Member State issuing the advance border decision, or

b) at least one of the parties is tax resident in more than one country simultaneously, or

c) one or more of the parties is pursuing its activities in another country through a permanent establishment and the particular transaction forms part or the total of operations of the permanent establishment, or

d) a transaction or series of transaction which has/have cross – border effects.

4. Period of validity of the tax ruling and the taxpayers’ liability

Apply as long as the conditions are met and the information based on which is issued are valid and provided that there is no change in legislation or regulations or issue of any circular which influence the tax ruling given.

The taxpayer has the obligation to notify the Tax Department for any changes of important events or circumstances occurred relating to tax ruling issued as well as to the party/ies of the transaction/s the tax ruling referred to.

The new procedure will apply for requests submitted by September 30, 2016 onwards.

For more information, please contact our PHS Tax Department.