The Tax Department of the Republic of Cyprus, by an announcement dated 30/06/2020, provided further information as regards the process to be followed to stamp documents in accordance with applicable Stamp Duty legislation.
In accordance with the latest guidance, as from 29/06/2020 the stamping of documents with a fixed stamp duty fee will be done by the interested parties themselves. Stamps will be available for purchase only from approved representatives (including local bar associations).
This is in contrast to the practice up to today whereby stamps would be placed on documents by the District Offices of the Tax Department.
New Procedure Announced by the Tax Department
- Calculation and Purchase of Stamps
Stamp duty will be calculated by the interested party based on relevant guidance provided and stamps may be purchased from authorised representative (including Local Bar Associations).
- Affixing and Cancelling of Stamps
Stamps will need to be affixed to the relevant document and cancelled so that they cannot be reused. Cancellation of stamps needs to be done by drawing a double diagonal line on the stamp and placing a monograph by the interested party and the date of cancellation.
A document bearing a non-cancelled stamp (a stamp that has not being marked as cancelled) is considered as non-stamped.
- Late stamp duty for documents subject to Stamp Duty up to € 35
In cases where:
- The stamp duty is not paid within 30 days from the first signing or drafting of the document, then a fine is imposed which is equal to the stamp duty fee (e.g. stamp duty €35, fine € 35).
- The stamp duty is not paid within six months from the first signing or drafting of the document, then the fine is equal to twice the stamp duty fee (e.g. stamp duty € 35, fine € 70).
In both cases the procedure will be carried out before an Officer of the Tax Department or a Registrar.
- Copies of Documents
- Each copy is affixed with a stamp worth up to 2 euros, which is cancelled as per the above procedure.
- The indication “True Copy” should be placed/noted by the same party who also stamped the original document.
- In order for the copies to be considered properly stamped, they must always be submitted together with the original stamped document.
Some of the Documents to which this New Procedure applies include Cyprus Trusts, Wills drafted under Cyprus law, Contracts which do not specify a contract value (consideration), Assignment of Trademarks, Assignment of Land by way of a gift.
The Cyprus Stamp Duty Law
Stamp Duty is a tax on documents. The Cyprus Stamp Duty Law provides that stamp duty is payable on any document which concerns any property situated in the Republic of Cyprus or matters or things to be executed or done in the Republic of Cyprus, irrespective of the place of execution of the document.
Documents that are subject to stamp duty cannot be accepted as admissible evidence in Court-save for criminal proceedings- unless these documents are duly stamped. If a non-stamped document needs to be submitted as evidence in Court proceedings, the document can be stamped even at this stage but the fines must be paid.
Documents whereby Stamp Duty is based on the value of a Contract: The Tax Department intends to also announce a new procedure for the stamping of documents whose stamp duty is calculated based on the value of a contract.