Cyprus: Implementation of Pillar Two global minimum tax rules and public country-by-country reporting

Implementing laws largely align with EU directives

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January 21, 2025

Legislation implementing the EU Minimum Tax Directive was published in the official gazette on December 18, 2024.

  • The legislation largely aligns with the provisions of the directive and introduces the income inclusion rule (IIR) for financial years starting on or after December 31, 2023.
  • A domestic minimum top-up tax (DMTT) and undertaxed profits rule (UTPR) are introduced for financial years starting on or after December 31, 2024.

Read a January 2025 report prepared by KPMG’s EU Tax Centre

In addition, a decree implementing the EU Public Country-by-Country (CbC) Reporting Directive was published on December 6, 2024.

  • The provisions are largely aligned with the text of the directive.
  • Cyprus adopted the “safeguard clause,” which allows in-scope groups to temporarily omit information for up to five years if disclosing it would cause significant competitive disadvantage to the companies concerned, provided they can justify the omission.
  • Cyprus opted for the website publication exemption, which exempts companies from publishing the report on their own websites, if the report is already made publicly available to any third party in the EU, free of charge, on the website of the Cypriot commercial register.

The new provisions apply to financial years beginning on or after June 22, 2024.

Read a January 2025 report prepared by KPMG’s EU Tax Centre

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