Relief from Double Taxation
Where the income of a resident derived from sources outside Cyprus, or where the income of a non-resident derived from sources within Cyprus is taxable in two jurisdictions, Cyprus relies in a system of tax credits, and a series of Double Tax Agreements. Tax credits grant a credit for any foreign tax paid if tax is also due in Cyprus.
Where the foreign tax paid is greater, than the local tax due, no refund is given. Where the foreign tax paid is less then local tax, then additional tax is payable to the Commissioner of the Inland Revenue Department in Cyprus.
Cyprus Double Tax Treaties
Cyprus has a large network of double income tax treaties in place, specifying specific treatments of taxation where the taxing rights may fall between two
jurisdictions.These treaties provide Cyprus with a substantial advantages as an international tax centre. These Treaties enable tax-paying companies to set off the extra tax paid in one Country against the tax paid in another country, thus effectively avoiding double taxation.
The Double Tax Agreements concluded and their respective date of enforcent between Cyprus and other countries can be found on the official website of the Ministry of Finance. http://www.mof.gov.cy/mof/ird/ird.nsf/dmldtc_en/dmldtc_en?OpenDocument
