Cyprus VAT rise implementation
Following this week’s 1% rise in Cypriot VAT to 19%, guidance on the VAT increase has been issued. There was also an increase in the reduced VAT rate (transport of passengers, hotels and restaurants) from 8% to 9%.
Change of VAT rate, credit notes and pre-payments
In basic terms, the new, higher rate must be applied on the supply of any goods or services on or after 13 January 2014. Any pre-payments must be at the new rate, too. Payments for services or goods after 13 January for supplies completed prior to this date should be at the old, 18% VAT rate.
Any credit notes issued in the future on invoices at the old 18% rate should use the 18% rate is applied when the goods were supplied.
Companies holding stocks must perform full stock takes, which should be retained for inspection by the tax authorities for six years.