Relief from interest and penalties on overdue taxes for tax years 2016 – 2019



We would like to inform you that an amending law was published in the Government Gazette which extends the provisions of the Law Regulating the Settlement of Overdue Taxes (the Law), offering part relief from interest and penalties. The provisions of the amending law are effective from 29 April 2021, the date of its publication.


RECAP OF THE EXISTING TAX LAW PROVISIONS

The Law gives the opportunity to companies and individuals that have overdue taxes, to settle them through a regulated instalment scheme (via the Ariadne Government Portal) benefitting from part relief of interest and penalties due, but not of the tax due.


Up to now, the Law allowed eligible taxpayers to enter a scheme for the settlement of overdue taxes for tax years up to 2015 as follows:

AMENDING LAW

The amending law provides that “eligible taxpayers” may enter the scheme for part relief of the interest and penalties due on overdue taxes relating to tax years 2016 – 2019 (both years inclusive) subject to conditions.


“Eligible taxpayers” are:

1. Businesses and self-employed individuals subject to VAT, and

2. Businesses and self-employed individuals who are exempt from the obligation to register for VAT (e.g. Approved Private Tutoring Schools, Music Schools and Dance Schools).


that have experienced a decrease in their annual turnover by at least 25% in 2020 compared to 2019, due to business disruption caused by COVID–19.


An application to enter the relief scheme must be submitted within 12 months from the entry into force of the amending law (i.e. up until 29 April 2022) provided that all tax returns due, are submitted before the application date and not later than 31 December 2021.


Termination of a regulated settlement scheme

In accordance with the law, a settlement scheme is terminated in cases where the taxpayer delays to pay 5 instalments.

Due to the effects of the COVID-19 outbreak, instalments that have not been paid during the 10-month period, March - December 2020, will not be taken into consideration when assessing the 5 delayed instalments.




DISCLAIMER

This article and its publication are intended to provide a brief introduction and act as a general guide on the subject at hand . This is provided for information purposes only and cannot be utilized as a substitute for professional advice. This document does not represent a legal opinion and each natural or legal person seeking to employ the provisions of the document should seek independent advice based on the particulars of its case. No responsibility is accepted by the author or the publishers for any loss suffered from acting or refraining from acting based on the contents of this publication.


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