Invoicing and Tax regulation in Cyprus

Invoicing Regulation in Cyprus

In Cyprus, invoicing regulations are mandatory for all businesses and a part of the overall tax compliance. All businesses are required to issue invoices for all transactions, both domestic and international. Rules for invoicing are strictly regulated according to the EU invoice directive and Cypriot VAT law.

Real-time Reporting / Fiscalization in Cyprus

Real-time reporting or fiscalization is not mandatory in Cyprus. However, businesses are required to keep their VAT records updated, which can be audited at any time. Additionally, operating with an electronic cash register is recommended to maintain fiscal discipline and avoid penalties.

E-invoicing in Cyprus

E-invoicing in Cyprus is becoming increasingly popular, but it's not yet mandatory, except for B2G transactions, where it is required since 2019 due to the EU directive. For B2B and B2C transactions, companies can decide whether they want to use e-invoicing or traditional methods. The digital format must follow certain requirements, and it's suggested to validate it with digital signatures for authenticity and integrity.

VAT/GST/Tax Compliance in Cyprus

Compliance with VAT and other tax regulations is mandatory in Cyprus. The standard VAT rate is 19%, but lower rates of 5% and 9% apply to certain goods and services. VAT must be filed quarterly. Businesses must register for VAT if their taxable turnover exceeds €15,600 in a calendar year. There are severe penalties for non-compliance, including fines and jail terms.

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