T&L D-briefs - May 2025
In this issue, we:
- Share important international and local tax developments;
- Highlight the importance for complying with the new Pillar 2 rules;
- Outline the process for transferring a company’s registered seat to Cyprus.
Tax Developments
International Tax Developments
CJEU rules on interpretation of GAAR under EU PSD
On 3 April 2025, the Court of Justice of the European Union (CJEU) ruled in case C-228/24 that the general anti-abuse rule (GAAR) under the EU parent-subsidiary directive (PSD) allows an EU member state to refuse a tax exemption on dividends received by a parent company if the subsidiary constitutes an artificial arrangement. The court further ruled that all relevant facts and circumstances, including steps in the arrangement, should be considered, and a tax advantage that defeats the object or purpose of the PSD must be shown.
For more details click here.
Cyprus and Netherlands sign double taxation treaty for Curacao
On the 23rd of April, Cyprus signed a tax treaty with the Kingdom of the Netherlands to eliminate double taxation concerning Curacao. The agreement seeks to eliminate double taxation on income and prevent tax evasion and avoidance between Cyprus and Curacao, aiming to improve transparency, strengthen economic cooperation, and facilitate cross-border business activities.
Follow the link below to find out more.
Pillar Two: A new era in Global Tax Compliance |
The introduction of Pillar Two marks the beginning of a transformative era in international tax regulations, establishing a groundbreaking Global Minimum Tax Rate of 15%. This seismic shift compels Multinational Enterprise Groups (MNE Groups) and Large-Scale Domestic Groups to efficiently cope with its intricate complexities, augmented data mandates, and heightened reporting requisites. This article embarks on an insightful exploration of the Pillar Two framework, delving into pivotal considerations specifically for Cypriot companies within these enacted groups. Through a high-level analysis, we illuminate the distinctive challenges and strategic considerations they face as they navigate this new tax landscape.
Follow the link below to find out more.
Cross-Border Conversions and Redomiciliations |
The process of transferring the registered seat of a company to and from Cyprus is regulated in the Companies Act, Cap. 113. Furthermore, following the adoption of the relevant EU Directive concerning cross-border conversions, the procedures for transferring a company’s registered seat within the EU and from outside the EU have been distinguished.
This differentiation was introduced to establish a harmonized process regulating cross-border conversions within the EU.
This article outlines the process for transferring a company’s registered seat to Cyprus within the EU and outside the EU.
Follow the link below to find out more.
Archive
The previous T&L D-briefs are available below.
T&L D-brief March 2025
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