Tax Penalties in Cyprus from 2026

Starting from 1 January 2026, updated penalties for tax violations come into force in Cyprus. These rules apply to tax returns for the 2025 tax year, as the deadlines for submission and payment fall in 2026. Below are the main grounds for penalties and the applicable sanctions imposed by the tax authorities.

Ground No. 1: Late Submission of Tax Returns

A violation occurs if:

• the tax return is submitted after the установленный deadline;
• the tax return is not submitted at all.

Applicable penalties:

• a fixed penalty of €150 is imposed for any late submission;
• the penalty increases to €300 if the tax authorities issue an official written notice and the return is not submitted within 60 days from receipt of such notice.

It is important to note that the obligation to file a tax return remains even if the calculated tax payable is €0. Failure to submit the return on time will result in a penalty, regardless of whether any tax is due.

Ground No. 2: Late Payment of Tax

A violation occurs if:

• the tax declared is not paid within the установленный deadline;
• underpayment is identified by the tax authorities following an audit.

Applicable penalties:

• a penalty of 5% of the unpaid tax is charged immediately upon any delay;
• an additional 5% penalty is applied if the tax remains unpaid for more than 60 days after the due date;
• interest on late payment is charged at 3.5% per annum and accrues for each full month of delay. For the 2025 tax return, interest starts accruing from 1 August 2026.

Filing and Payment Deadlines

The deadline for filing tax returns and paying taxes for the 2025 tax year is 31 July 2026. Please note that tax authorities may revise these deadlines, so it is advisable to monitor official updates.

Timely filing and payment will help taxpayers avoid penalties and additional financial costs.

Note: The content of this article is relevant at the time of its first publication. It is intended to provide general information on the topic and does not constitute legal advice. We recommend seeking professional advice regarding your specific matter before taking action based on the information presented. For more information or consultation, please contact our tax experts by email at contact@mainpartnertrust.com

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