Cyprus Tax Alert: First Provisional Tax Instalment for Tax Year 2026
The deadline for the payment of the first provisional tax instalment for tax year 2026 is 31 July 2026.
Companies and individuals who expect to generate taxable income during 2026 should review their provisional tax position and arrange the relevant calculation and payment before the deadline.
Who is required to pay provisional tax?
Provisional tax generally applies to:
- companies expecting to generate taxable profits during 2026, and
- individuals receiving taxable income from business, self-employment or other sources not fully covered through tax withholding.
Taxpayers who do not expect to generate taxable income during 2026 generally do not have a provisional tax liability.
How is provisional tax calculated?
Provisional tax is calculated based on the estimated taxable income for the year ending 31 December 2026, after taking into account any applicable deductions, tax losses and foreign tax credits.
The resulting tax is payable in two instalments:
| Instalment | Payment deadline |
|---|---|
| First provisional tax instalment | 31 July 2026 |
| Second provisional tax instalment | 31 December 2026 |
Why is an accurate estimate important?
The provisional tax calculation should be based on a reasonable estimate of the taxpayer’s expected taxable income for the full year.
Where the provisional taxable income declared is less than 75% of the final taxable income, an additional tax of 10% may apply to the difference between the final tax liability and the provisional tax paid.
Can the estimate be revised?
The provisional tax estimate may be revised upwards or downwards until 31 December 2026, depending on the taxpayer’s actual and expected financial performance.
Taxpayers are encouraged to review their estimate during the year and make any necessary revisions on time.
Payment of provisional tax
The provisional tax obligation must first be created through the Tax Portal of the Cyprus Tax Department.
Payment can then be made electronically by credit or debit card or through online banking, using the relevant Payment Reference Number.
Late payments may be subject to interest and statutory penalties.
How can we help?
For more information or assistance, you can contact us at: 22484429 or [email protected]