As a response to the sanctions placed on Russia, due to the current state of affairs in Ukraine, Vladimir Putin has signed, on the 8th of August 2023, a decree suspending (not abolishing) the double tax treaties with multiple countries including U.S.A., Australia, Japan and many European countries.
From a Cyprus perspective, the authorities will continue to honour the Tax Treaty with Russia until further notice. The suspension of the treaty from Russia’s side will have some tax implications to Cyprus registered companies that receive income from Russian entities. The tax applied on interest which is deducted at source will increase from 15% to 20%. As for royalty income, tax applied will rise from 0% to 20%, whereas the tax deducted at source for dividend income will remain at 15% as it was before.
This decision will not have a huge influence on Cyprus economy as it concerns a lot of countries.
Due to the situation in Ukraine, Cyprus has limited its affairs with Russia.
Eurofast keeps abreast of the changes affecting businesses in over 23 countries of Southeast Europe and in the Middle East and is ready to provide you with any assistance on this matter and/or other related issues.
For more information, contact our Cyprus office at nicosia@eurofast.eu
Avraam Apostolou
Acting Manager, Accounting & Tax
Eurofast Nicosia
nicosia@eurofast.eu
Fanos Pavlou
Manager, International Business Services Division
Eurofast Nicosia
nicosia@eurofast.eu