What can Cyprus businesses claim as expenses?
10 common business expenses with Tax Department (Τμήμα Φορολογίας), Ministry of Finance-compliant rules for limited companies, sole traders and contractors in Cyprus.
Accountant, Legal and Professional Fees
Yes, fees for accountants, lawyers and other advisers are generally business costs when they relate to the company's trading.
Business Entertainment
Partially. Business entertainment is deductible only up to 1% of gross revenue, capped at €17,086 a year. Anything above that is disallowed for corporate income tax.
Commercial Vehicles
Yes. Non-saloon commercial vehicles qualify for a wear and tear allowance of 20% a year, straight-line on cost.
Computers and IT Hardware
Yes. Computer hardware qualifies for a wear and tear allowance of 20% a year, straight-line on cost.
Employer Payroll Contributions
Yes. Employer social insurance, GESY and the employer funds are payroll costs of the business.
Fines and Late Filing Penalties
No. Late-filing penalties, such as the HE32 charge or the VIES statement fee, are not business running costs. Book them separately.
Furniture and Fittings
Yes. Furniture and fittings receive a wear and tear allowance of 10% a year, straight-line on cost.
Plant, Machinery and Buildings
Yes. Plant and machinery receive 10% a year. Commercial buildings receive 3% and industrial, agricultural and hotel buildings 4%.
Private Saloon Cars
No. Costs of private saloon cars, and related loan interest, are not deductible, and saloon cars get no capital allowance.
Software
Yes. Software receives a wear and tear allowance of 33 and one third percent a year, and items under about €1,709 are written off in year one.