Accounting/Taxation News

2015: Property Tax

The immovable property tax is imposed on the owner (individuals and legal per sons) of immovable property which is situated in Cyprus. The tax is calculated on the market value of immovable property on 1 January 1980, and is payable by self - assessment. For the tax year 2015, the immovable property tax is calculated in accordance to the below rates:

  • Up to €40,000 6.0% €240
  • €40,001 – 120,000 8.0% (640+240) €880
  • €120,001 – 170,000 9.0% (450+880) €1,330
  • €170,001 – 300,000 11.0% (1,430+1,330) €2,760
  • €300,001 – 500,000 13.0% (2,600+2,760) €5.360
  • €500,001 – 800,000 15.0% (4,500+5,360) €9.860
  • €800,001 – 3,000,.000 17.0% (37,400+9,860) €47.260
  • Over €3,000,.000 19.0% (€47.260 + )

No tax is payable if the value of the property does not exceed the amount of €12.500.

Tax is payable either by Cypriot tax residents or non - Cypriot tax residents who as at 1.1.2015:

  • Own Immovable property which is registered on their names .
  • Acquired immovable property, but the property was not registered on their names as at 1.1.2015.
  • Possess property under a Lease Agreement which was filed with the Cypriot Department of Lands and Surveys.

The Council of Ministers has voted amendments to the Immovable Property Tax Law, which have been enacted into the immovable property tax Law of 2015. The amendments have been published in the official Gazette of the Republic on 18 Sep. 2015

EU States Told To Address Widening VAT Gap

Tax Commissioner Pierre Moscovici has urged European Union (EU) member states to "take the steps needed to fight tax evasion and tax fraud," after new figures showed that the value-added tax (VAT) gap did not narrow in 2013.

According to a new Commission report, the total amount of VAT lost across the EU was approximately EUR168m (USD187.5bn) in 2013. This equates to 15.2 percent of total revenue lost to fraud and evasion, tax avoidance, bankruptcies, financial insolvencies, and miscalculation in 26 member states. Croatia and Cyprus were not included in the estimates, due to as-yet-incomplete national account statistics for the two countries.

The Commission found that the overall VAT Total Tax Liability (VTTL) for the EU-26 grew by around 1.2 percent, while collected VAT revenues rose by 1.1 percent. The VAT gap is defined as the difference between the amount of VAT actually collected and the VTTL, in absolute or percentage terms.

The VAT gap increased year-on-year in absolute values, by EUR2.8bn. As a percentage, the overall VAT gap stayed constant at 15.2 percent.

In 2013, member states' estimated VAT gaps ranged from a low of four percent in Finland, the Netherlands, and Sweden, to a high of 41 percent in Romania. 15 member states, including Latvia, Malta, and Slovakia, saw an improvement in their figures. On the other hand, 11 member states, including Estonia and Poland, saw a deterioration.

The VAT system in the EU is governed by a common legal framework, the VAT Directive. There is a minimum standard VAT rate of 15 percent, above which EU member states are free to set their own national VAT rates.

Moscovici said: "This important study highlights once again the need for further reform in VAT collection systems across the EU. I urge Member States to take the steps needed to fight tax evasion and tax fraud at all levels. This remains a burning issue and is at the top of this Commission's agenda."

Source: www.tax-news.com