Author: lorraine

The Council of Ministers have announced a new ministerial decree (No.288/2021), that individuals whose gross annual income is below €19,500 are exempt from submitting a personal income tax declaration for the tax year 2020.

As a reminder, in August 2020 the House of Representatives amended the Assessment and Collection of Taxes Law making it mandatory for all taxpayers to submit tax returns irrespective of their income level as from the tax year 2020.

Please bear in mind the article published by Fairfax on 21^st April 2021 informing our customers that the electronic submission of the 2020 personal income tax return for individuals with a gross annual income of more than €19,500 has been extended to 30 September 2021.

The expert team at Fairfax are available should you require any further information or clarifications on this or any other tax issues on accounts@fairfaxyeaman.com or by calling +357 25558025

In April 2021 the Cypriot House of Representatives voted to amend certain provisions relating to the Assessment and Collection of Taxes Law 4/78.

They agreed in extending the deadline for submission of certain direct tax returns and payment of certain tax liabilities.

The changes are as follows.

‘Employees and Pensioners’ (Form T.D.1 employees)

The deadline for electronic submission of the 2020 income tax return of ‘employees and pensioners’ (i.e. those individuals completing form ‘T.D.1 employees’) has been extended from the end of 31 July 2021 to the end of 30 September 2021 and with a further extension to 30 November 2021 .

The deadline for the payment of the related tax via self-as and assessment has been extended to the same date.

‘Employers’ (Form TD7)

The deadline for electronic submission of the total 2020 payroll (Form TD7) has been extended from the end of 31 May 2021 to the end of 30 September 2021.

Settlement of second instalment of the 2020 provisional tax

The deadline for settlement of the second instalment of the 2020 provisional tax has been extended from 31st January 2021 to 30th September 2021.

For any advice or assistance in relation to the above please contact the expert team at Fairfax on + 357 25558025 or email accounts@fairfaxyeaman.com

Fairfax, our specialist outsourced payroll, bookkeeping, accounting and HR services firm, is proud to announce its recent membership to CPMA – Cyprus Payroll Management Association.

About CPMA

Founded in 2019 by a number of recognised industry professionals, CPMA aims to study, research and train members in the payroll management sector. Areas of specialisation include taxation, social insurance, human resources, as well as other labour issues directly related to payroll.

In addition, the association aims to promote suggestions in laws, regulations and good practices in cooperation with relevant state authorities and bodies.

About Fairfax 

Fairfax is a well-established firm with a strong presence in Cyprus. Since its inception in 2014, the company has gone from strength to strength, offering high-quality, cost-effective outsourced services for local and internationally-renowned businesses with a presence in Cyprus.

Combining the latest tools and in-depth expertise, the team at Fairfax works meticulously to ensure all clients’ needs are met with in a professional, accurate and flexible manner.

Benefits of the Membership

The membership with CPMA will reinforce the quality of Fairfax’s specialist services, ensuring they gain access to immediate information on publications related to laws, bills, regulations and other information associated with payroll.

What’s more, by partnering with CPMA, Fairfax will have continued access to comprehensive information when dealing with payroll issues. This will enable the firm to contribute constructively to the formation of long-term development conditions in the payroll division, which will, in turn, provide added value for customers.

The goal of this collaboration is to equip Fairfax with all the tools it needs to continue offering state-of-the-art outsourced services. Through this collaboration, the team at Fairfax will benefit from the support and guidance of CPMA, giving them a wider range of solutions to various issues related to the payroll management sector.

Further, Fairfax will be better positioned to enhance their professional knowledge of the sector through various educational events, seminars and committees organised by CPMA.

Benefits of Outsourcing

With HR and payroll regulations constantly changing, these processes can be a time-consuming and complex endeavour, particularly since critical amounts of data must be meticulously input.

Penalties for errors, omissions or late filings can be extremely costly, while mistakes can often lead to audits and fines – something no business needs or wants.

Outsourcing payroll and other functions allows employers to focus on their core areas of business, which immediately frees up valuable time.

The Fairfax team remains on hand to assist any company in establishing their personnel from day one. All team members possess exhaustive knowledge of ever-changing government and employment rules and regulations, ensuring clients remain up-to-date with any complex changes in compliance, legislation or employment law.

If you would like to learn more please contact Fairfax on +357 25558025 or email accounts@fairfaxyeaman.com.

 

End of the suspension period for the increased contribution to the General Healthcare System (GHS)

Fairfax wishes to kindly remind all employers as from 1 July 2020, the suspension of the increase in the contributions to the National Health Insurance System (NHIS), ends.

The collection of the contributions for the first stage started on 1 March 2019. For the complete implementation of the NHIS, contributions started on 1 March 2020, however, due to government measures for supporting the economy during COVID-19, the increase of contribution was deferred by 3 months (up to 1 July 2020) and therefore ceases to apply.

The House of Representatives have clarified in the event where businesses/employers have already proceeded in the implementation of the reduced rates for March 2020, the 3-month period applies from 1 March 2020 to 31st May 2020 for those businesses/employers only. In the event where the reduced rates have not been applied for March 2020, the 3-month period applies from 1 April 2020 to 30 June 2020.

Specifically, as of 1^st July 2020, employers will contribute 2.90% on the employee’s earnings, and the employees will contribute 2.65% The employer is responsible for paying both their own and their employees’ contributions through Social Insurance or Income Tax Office Services, depending on the nature of income, by means of deductions from their salary

How can we help?

Fairfax and its dedicated personnel are at your service to assist you in adjusting to the new changes introduced by the authorities.

For more information call +35725558025 or email accounts@fairfaxyeaman.com

Social Insurance maximum insurable income increase, National Health Insurance System Contributions and change of Income Tax Legislation concerning the tax allowances.
Fairfax wishes to inform all employers that in 2020 an increase in Maximum Insurable Income in relation to Social Insurance Fund (SIF) contributions will come into effect, the National Health Insurance System (NHIS) will enter the second phase of full implementation with the increase in contribution rates and an amendment in tax legislation has come into force from 19/12/2019 concerning the allowances for income tax purposes.

SIF Insurable Income increase
According to the provisions of the Social Insurance Law of 2010 the rate of social insurance contribution is applied to a maximum level of earnings. The maximum level of earnings up to 2019 was €54,648, while from 2020 the maximum level of insurable income will be increased to €54,864 per annum.

There will be no further change at the contribution rates currently in effect.

 

 

NHIS Full implementation
According to National Health Insurance System Law of 2010 (as amended in 2017), employer and employee contributions for the implementation of the system that commenced in 2019 will come in full completion in 2020 entering the second phase.
Specifically, as of 01/03/2020, employers will contribute 2.90% on the employee’s earnings, and the employees will contribute 2.65% increased from 1.85% and 1.70% retrospectively that is currently in effect and will continue to be until the end of February 2020. The employer is responsible for paying both their own and their employees’ contributions through Social Insurance or Income Tax Office Services, depending on the nature of income, by means of deductions from their salary

 

It should be noted that NHIS contributions are paid on all employee earnings (as earnings are defined in the Social Insurance Law) up to €180,000. There is no indication at the moment that the maximum income for NHIS purposes will be increased.

Tax Allowances
Income Tax Department has revised article 14 of the Income Tax Law 118(I)2002 introducing a new tax relief rate for allowances including life insurance, medical, pension, provident fund and social insurance contributions. As of 19/12/2019 the tax relief benefit for the tax payers was increased from 1/6 to 1/5.

Due to the late publication of the relevant article amendment, the Income Tax Department is expected to proceed with a number of tax refunds to the tax payers that are affected once the submission of the personal income tax return for Tax Year 2019 is completed.

How can we help?

Fairfax and its dedicated personnel are at your service to assist you in adjusting to the new changes introduced by the authorities.

For more information call +35725558025 or email accounts@fairfaxyeaman.com