On 31 January, the Cyprus Tax Department (CTD) finally brought the regime providing for the mandatory reporting of reportable cross border arrangements (RCBAs), known as DAC6, into force in Cyprus. Up until this point, various transitional provisions and safe-harbours had been in place to soften the introduction of the regime.
From 31 January, all legacy RCBAs subject to DAC6 in Cyprus must be reported to the CTD. Failure to report may incur potentially heavy administrative fines on the part of defaulting intermediaries, such as tax advisors, law firms, accountancy firms and administrative service providers (to name but a few).
To recap the DAC6 regime in Cyprus is governed by:
- Council Directive 2018/822/EU of 25 May 2018, the original EU text introducing DAC6 to the EU – which amended Council Directive 2011/16/EC
- The Cypriot Administrative Cooperation in Tax Matters (Amendment) Law 2021 (Cyprus DAC6 Law), which implemented the EU directive and amended and expanded the prior regime cooperation regime in Cyprus from 2012
- Most recently, the Cyprus DAC6 Guidance Notes 2021 (Cyprus DAC6 Guidance), known officially as the Decree on Administrative Cooperation in Tax Matters Relating to RCBAs of 29 October 2021
It is now imperative that intermediaries and institutions in Cyprus fully understand and report RCBAs under DAC6. Luckily Harneys can help!
Our previous update on DAC6 in Cyprus can be found here.
See our subsequent blog post for an unofficial translation of the Cyprus DAC6 Guidance in English.