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Cyprus adopts EU exchange of tax information

Cyprus has brought its domestic law inline with EU directive on mandatory automatic exchange of tax information.

Cyprus has recently introduced Law 33(I)/2018 in furtherance of EU Directive 2016/881/EU. The changes concern EU wide administrative cooperation in the field of taxation.

The definition of ‘automatic exchange’ has been changed; and there are new provisions requiring ultimate parent entities of multinational enterprises resident in Cyprus for tax purposes to file country-by-country reports within 12 months of the end of each fiscal year. The first fiscal year for which a country-by-country report must be filed is that beginning on or after January 1 2017.

The country-by-country report will henceforth require the reporting of aggregate information for each jurisdiction in which a multinational group operates and an identification of each constituent entity of that said group.

Upon filing, the Cyprus Tax Department will notify its counterparts in other EU member states of any information relating to a constituent entity resident in another member state within 15 months from the end of the reporting period.