Can I Claim Fines and Late Filing Penalties as a Business Expense in Cyprus?
No. Late-filing penalties, such as the HE32 charge or the VIES statement fee, are not business running costs. Book them separately.
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What Tax Department (Τμήμα Φορολογίας), Ministry of Finance says
Late HE32 returns cost €50 plus €1 a day, capped at €150. A late VIES statement costs €50. A late OSS return costs €100 and late payment attracts a 10% addition plus interest. A 10% surcharge applies when a provisional tax estimate is below 75% of final taxable income. Finn's rules do not treat these as deductible costs.
When you can claim
- Adviser fees to fix the filing process that caused a penalty, as a separate cost
- Reminder and filing tools that prevent penalties
- Payment of the underlying tax, which is a liability and not a penalty
- Records kept so a wrongly charged penalty can be disputed
When you cannot claim
- HE32 late-filing charges
- VIES late statement fees
- OSS late return and late payment charges
- The 10% provisional tax surcharge
Good to know
Pro tip: Keep penalties in a dedicated account. The yearly total shows which deadlines need better reminders.
Stop guessing what you can claim in Cyprus
AccountsOS automatically categorises expenses with Tax Department (Τμήμα Φορολογίας), Ministry of Finance-aware rules and tells you exactly what is claimable.
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