The Ultimate EU Holding
Cyprus VAT: Master the EU’s most efficient VAT landscape. Fully synchronized with the 2026 Digital Tax Reform and the new 15% Corporate Tax environment.
Following the December 2025 Tax Reform, Cyprus has modernized its VAT reporting through the Tax For All (TFA) portal. Our experts ensure your company meets the mandatory digital filing standards for 2026.
| Category | Rate | Applicability (2026) |
| Standard Rate | 19% | Most Goods & Services |
| Reduced Rate | 9% | Catering, Restaurants, Local Transport |
| Reduced Rate | 5% | Foodstuffs, Books, Medical, First-time Housing |
| Zero Rate | 0% | Exports, Intra-EU Supplies (VIES), Ship/Aircraft |
| Registration Threshold | €15,600 | Mandatory if turnover exceeds this in 12 months |
VAT registration is not just a legal obligation; it is a strategic advantage for your Cyprus LTD.
1. Reclaim Input VAT
Under the 2026 rules, companies can fully reclaim VAT paid on business expenses, office rent, and professional services. This effectively reduces your operational costs by 19%.
2. EU Intra-Community Trading (VIES)
If you sell services or goods to other EU-based businesses, a Cyprus VAT number allows you to invoice at 0% VAT. We handle the mandatory VIES filings to ensure your cross-border trade remains seamless.
3. OSS & IOSS for E-Commerce
For digital services and distance sales of goods, we implement the One-Stop Shop (OSS). Pay your total EU VAT once in Cyprus rather than registering in every member state.
The Cyprus House of Representatives voted on December 22, 2025, to increase penalties for non-compliance. Our service protects you from:
VAT registration in Cyprus is required if your taxable supplies exceed €15,600 in 12 months. However, for most of our clients, we recommend “Voluntary Registration” from the start.
Why register early?
If your Cyprus company sells services to businesses in the EU (e.g., a Belgian or German client), you do not charge Cyprus VAT. You apply the Reverse Charge mechanism.
Don’t let VAT complexity block your cash flow in 2026. Ensure your company is registered, compliant, and ready to reclaim input tax.
The standard rate in Cyprus is 19%. There are reduced rates of 9% and 5% for specific goods and services, and a 0% rate for exports and international transport.
Yes, as a consumer, you pay VAT on all local purchases. However, as a business owner, you can reclaim this “Input VAT” against the “Output VAT” you collect from customers. If you export services to businesses outside of Cyprus, you generally do not charge them VAT.
This is a reduced rate primarily used for the acquisition or construction of a primary residence in Cyprus. It is a major incentive for expats moving to the island, effectively saving them 14% on the purchase price of a new-build home (subject to specific size and value caps).
VAT returns are submitted quarterly. The deadline is the 10th day of the second month following the end of the VAT period (e.g., the Q1 return for Jan-March is due by May 10th).
For local sales, the threshold is €15,600. However, if you are providing digital services to other EU businesses, you effectively need to register for VAT and VIES immediately to comply with EU “Reverse Charge” rules and avoid charging your clients local VAT.
Registration is mandatory once your taxable turnover (sales) exceeds €15,600 in a 12-month period. However, Voluntary Registration is often recommended for holding companies or new startups to reclaim VAT on setup costs.
Standard processing by the Tax Department takes 1-2 weeks. However, with our “Substance-Plus” registration package, we ensure all documents are pre-vetted to avoid the lengthy queries that typically delay registration.
VIES (VAT Information Exchange System) is required if you trade with other EU VAT-registered companies. If you are a Cyprus tech company selling software to a German company, you must have a VIES-activated VAT number to invoice at 0%.
