The Corporation Tax rate for companies is 12.5%.
The following income is exempt from corporation tax:
- Dividend income;
- Interest Income not arising from the ordinary activities of the company or is closely connected to the ordinary activities of the company;
- Profit from the disposal of securities.
Any expenses which are incurred wholly and exclusively for the production of taxable income of the business are considered as tax-deductible expenses.
Tax losses are carried forward 5 years, to be set off with future taxable profits.
Tax credit for tax paid abroad
The tax paid abroad on income which is taxable under corporation tax in Cyprus is given as a tax credit against the payable corporation tax.