tax-rates-menu-l5Tax RatesTax NewsTax Videos
tax rates
Tax RatesIRS Tax FormsTax Articles
 
 
 
 
 
 

Home > Tax News > May 2010

Go to Tax Rates Home Page

TAX NEWS - may 2010

Cyprus Tax: Cyprus adopts new shipping tax rules

The Cypriot Parliament in late April adopted new legislation on the taxation of income from the operation of ships in international waters, as well as the taxation of ship management services.

The new legislation follows lengthy negotiations with the European Commission and expands significantly the tax benefits granted to the shipping industry under existing legislation.

The new legislation is in full compliance with EU Guidelines on state aid to the maritime industry. It covers ship owners and charterers, as well as ship managers, and allows for the taxation of income resulting from a qualifying shipping activity under the tonnage tax regime instead of under the corporate income tax law.

More specifically, the new legislation covers owners of ships registered under the Cypriot flag, owners of ships registered under the flag of an EU or European Economic Area member state and who are residents for tax purposes of Cyprus, owners of a fleet of both EU/EEA and non-EU/EEA ships, and ship managers providing technical and/or crewing services in respect of qualifying ships, among others.

The new legislation does not cover commercial management of ships, which was covered under the previous legislation.

Except for owners of ships sailing under the Cypriot flag, all other owners can elect annually to be taxed under the provisions of the corporate income tax law or tonnage tax regime. But once the election is made for the tonnage tax regime, they must remain under this regime for at least 10 years. If the ship owner/charterer/ship manager elects to leave the tonnage tax regime before the end of the 10 year period, then any tax on income saved must be repaid.

The new legislation came into effect as from 1 January 2022 and will remain in force until 31 December 2019. The legislative provisions may be extended by a Cypriot Council of Ministers Decree. Ernst & Young Cyprus Limited - Neophytos Neophytou, Philippos Raptopoulos and Maarten Koper (Limassol)
tax rates

© 2009-2010 TaxRates.cc  2009 - 2010 Tax Rate Guide and Tax Help Website

Disclaimer  |  Site Map  | Contact  |  Privacy Policy