The Cyprus Tax department has announced the ratification of the first double tax treaty between Cyprus and Jersey on 7 February 2017. The Treaty for the Avoidance of Double Taxation between Jersey and Cyprus will come into force as of 1 January 2018. The provisions of the Treaty relate to the following taxes:
- Income tax;
- Corporate income tax;
- Special contribution for the Defence of the Republic and;
- Capital gains tax.
Some of the main provisions include 0% WHT, with Cyprus retaining full control on taxation imposed on capital gains by Cyprus tax residents wishing to dispose their participation in companies organised in Jersey (with certain exception).
This ratification paves the way for new trade and investment opportunities between the two jurisdictions.