Cyprus companies with accounting profits for tax year 2022 must declare an appropriate amount of dividend to meet the 70% threshold of distributed profits on or before 31 December 2024. These provisions apply when the company has not distributed at least 70% of its after-tax profits within two years from the end of the tax year to which such profits relate. The distribution of deemed dividends to shareholders who are Cypriot tax resident is subject to payment of Special Defence Contribution (SDC) at the rate of 17% and General Healthcare Scheme (GESY) at the rate of 2,65%. The SDC and GESY contributions on deemed dividends must be paid by the 31st January 2024. Note that deemed dividends paid to non-Cypriot tax residents or Cypriot tax resident companies are exempt from SDC and GESY contributions.
