Taking into account the business upheaval caused by the coronavirus epidemic around the world, the Cyprus Government has announced a series of measures to support the country’s economy.

Government measures will help relieve citizens, boost incomes, secure jobs and business survival.

Below are details of these measures.

TAX MEASURES (DIRECT TAXATION)

• Extension for two months of the 2018 tax filing obligation for companies and self-employed preparing audited accounts. The deadline extended from March 31, 2020 to June 1, 2020.

• For the duration of the emergency, special arrangements will be made for those who are included in the Schedule of Settlement of Due taxes

VAT MEASURES (INDIRECT TAXATION)

• Temporary suspension of payment of VAT due for the periods ending February 29, 2020, March 31, 2020 and April 30, 2020. This suspension temporarily postpone until November 10, 2020, imposing an additional tax of 10% and interest and any penalties against persons subject to tax for late payment of VAT payable.

• The temporary suspension of VAT payment for the above periods shall apply provided that:

➢ The taxpayer submits his tax return within the deadline, and the amount of VAT related to the above periods is paid by 10 November 2020.

It should be noted that the penalty for late submission of VAT returns will remain in force and will continue to be a criminal offense if the declaration is not filed within the deadline.

• The temporary suspension of VAT payment does not apply to companies belonging to the following economic activity codes according to their registration certificate :

35111- Production of electricity

36001- Collection and distribution of water

47111 – Groceries and super- markets selling a large variety of goods

47112 – Kiosks

47191 – Retail sale of a large variety of goods of which food products, beverages or tobacco should not be predominant

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47211 – Retail sale of fruit and vegetables

47221 – Retail sale of meat and meat products including poultry

47231 – Retail sale of fish, crustaceans and molluscs

47241- Retail sale of bread, rolls and similar products of bakery

47242 – Retail sale of cakes, flour confectionery, sugar confectionery

47301 – Retail sale of automotive fuel (petrol stations) and retail sale of automotive lubricants

47411 – Retail sale of computers, peripheral units and software incl. videogames

47611 – Retail sale of books

47621 – Retail sale of newspapers and stationery

47651 – Retail sale of games and toys excluding videogames

47731 – Pharmacies

61101 – Cyprus Telecommunications Authority

61201 – Internet access provision

61301 – Satellite telecommunications activities

61901 – Other telecommunications activities

• Finally, it is noted that VAT rates remain the same (standard rate : 19% – reduced rate : 9%) CONTRIBUTION MEASURES

• Postpone of increased contribution to GESY – As amended by the NHS Law, passed on 27/03/2020, the non- payment of the increased contribution on NHS is valid for three months, from April 1, 2020 until June 30, 2020

Therefore, the rates of contribution to the NHS are as follows:

Contribution rates	01/03/20-31/03/20	01/04/20-30/06/20	01/07/20 και μετά
Employees	2.65%	1.70%	2.65%
Employers	2.90%	1.85%	2.90%
Self-Employed	4.00%	2.55%	4.00%
Contribution rates	01/03/20-31/03/20	01/04/20-30/06/20	01/07/20 και μετά
Pensiners	2.65%	1.70%	2.65%
Directors	2.65%	1.70%	2.65%
Persons responsible for payments to directors αποδοχών σε αξιωματούχους	2.90%	1.85%	2.90%
Other income (rent,interest,dividends)	2.65%	1.70%	2.65%
Goverment	4.70%	1.65%	4.70%

It is understood that in cases where no reduced rates have been applied in the month of March 2020, the period of application of the reduced rates shall be fixed from 1 April to 30 June.

• Payment of Contributions to the Funds Responsible for Collecting Social Insurance – The Ministry of Labour, Welfare and Social Insurance has made all necessary arrangements to pay current contributions for February salaries paid through the end of March only through JCC Smart website, or through the Social Security Services online payment system (for those who are already users of the online system for Social Insurance Services). Additional payment through JCC Smart, all employers are required as necessary shoveled to form “Statement of Earnings and Contributions (Form YKA2-002)” in special boxes located at the District Offices and Branches of Service to enable the submission of remuneration of all employees. It is understood that employers who submit data by computerized means (eg usb , cd, etc.) should place it together with the form “Statement of Salaries and Contributions (Form YKA2-002)” in the special boxes. Alternatively, the above YKA2-002 / computerized forms could be mailed to local District Offices and Branches.

• According to the amendment of the Late Settlement Social Contribution Act, passed on 27/03/2020, for those debtors that are included in the arrangement for late social contributions on March 1, 2020, the payment of dues corresponding to March 20 and April 2020 is suspended, and the repayment period is extended by two months.

• Extending the deadline for appeals from self-employed workers. This deadline is extended by one month. It is being transferred from 31 March 2020 to 30 April 2020.

REGISTRAR OF COMPANIES – MEASURES

• Extend the deadline for payment of the annual levy for 2020 until 31 December 2020 without the additional charge of 10% and 30%.

• Suspension of the publication announcement process in the Official Gazette of the Republic of the three-month notice before delisting of non-compliant companies, until January 2021.Extension of deadline of submission of annual returns the Registrar of Companies up to the 28/01/2021 without imposing a fee of € 20 for late submission. This extension relates to annual return with date of 01/01/2020 to 31/12/2020.

• Extension of the imposition of a charge for late submission of statutory forms to the TEP until the beginning of 202i.

ENHANCEMENT PROTECTION OF EMPLOYEES AND VULNERABLE GROUPS – SUPPORT MEASURES

• Special full Suspension Plan

• Businesses that are subject to mandatory suspension of work based on the decisions of the Council of Ministers and relevant Decrees of the Ministry of Health are entitled to special unemployment benefits of up to 90% of their employees. The specific unemployment allowance will be 60% and with a maximum allowance. 10% of the Company’s staff may not be included in the Plan including the Managers/Shareholders. If the company only employs up to 9 employees, then the requirement set out in the above paragraph for Shareholders will be fulfilled but instead of the 90% requirement, special

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unemployment allowance will be granted to all other employees on terms and conditions that will be published. in the Official Gazette of the Republic. Businesses that are subject to mandatory suspension of economic activities based on the decisions of the Council of Ministers and relevant Decrees of the Ministry of Health can apply online at www.coronavirus.mlsi.gov.cy.

• Special Partial Suspension Plan

Businesses that do not necessarily terminate their activities in Decisions basis of the Council of Ministers and the relevant decrees of the Ministry of Health, but have been reducing their turnover in excess of 25% as a result of the pandemic, have the opportunity to participate in that plan aiming avoid layoffs and at the same time affected workers receive an unemployment allowance for as long as the company is suspended . A special unemployment allowance equal to 60% and up to a maximum of 75% of the company’s employees if the company employs up to 50 employees, and up to 60% of its employees, for firms employing more than 50 employees on terms and conditions to be published in the Official Gazette of the Republic.

Specifically, in order for the Work Suspension Plan to be applicable for a business, an application must be submitted to the Ministry of Labour, Welfare and Social Insurance, stating the terms and conditions for participation in the Plan. Companies that make any redundancies will not be able to participate in the Plan.

With regard to the turnover reduction of more than 25%, a standardized certification will have to be submitted by the certified accountants of each business who, after reviewing the data for the respective period last year and based on all available data on the current situation, at this time , they will certify the estimated or existing turnover reduction for March and April 2020.

Note.

The Work Suspension Plan covers only salaries of employees of businesses and not any operational costs of them.

• Self-employed Plan

The Self-employed Plan drawn up force for the period from March 16 2020 until April 12, 2020 and relates to the payment of special unemployment allowance is equal to 60% to the sum of the weekly amount of insurable earnings, the basis of which the self-employed had the obligation to pay contributions to the Fund of Social Insurance for the fourth quarter of 2019.

The self-employed benefit cannot be less of € 300 if it concerns a period of four weeks and with a maximum limit of € 900 if it relates to a period of four weeks.

Self -employed persons who work in sectors not affected by the current situation are excluded.

The application for the Self- Employee Special Allowance is submitted by:

i. Self-employed that are subject to mandatory suspension of work based on the decisions of the Council of Ministers and relevant Decrees of the Ministry of Health which are posted on the website www.pio.gov.cy/coronavirus and not have changed the nature or and the way they operates, or

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ii. Have suspend partially the work themselves, ie have reduced the work by 25% during the month of March 2020 and provide a corresponding reduction of the their work for April 2020 in comparison with the corresponding months of the previous year and the reduction of cycle work their due solely to the state that received the business due to the pandemic of coronavirus COVID 19. in the event that the company does not operate during the previous year then the comparison will be made with the months before March 2020.

It is emphasized that the self-employed for their employees will submitted a separate Form for Full or Partial Suspension Operations.

Finally, it is noted that the main requirement for applying for the Special Allowance Self Employed is that the applicant did not fired any employee from 1st of March 2020 and in case of approval of his application, no employee is fired for the period which he will receive the Special allowance Self Employee plus one extra month (except for reasons which justified dismissal without warning).

• Granting ‘Special Leave’ to Parents Working in the Private Sector for the Care of Children up to 15 Years due to Suspension of Attendance at Schools, Public and Private, at Nursery and Child Care Centers

The Child Care Special Leave allowance will only be granted to employed working parents who have a gross monthly salary of up to 2.500 euros.

The Child Care Special Leave Allowance will be calculated as follows on January 2020 salary or in case there is no data on last salary 2020, based on last salary for which there is data within the last 9 months in Social Insurance:

i. For the first € 1,000 of the monthly salary, the beneficiary will receive a 60% allowance for that part of the salary and for the salary part from € 1,000 to € 2,000 the beneficiary will receive a 40% allowance.

ii. For single parent families the above rates increase to 70% and 50% respectively and the maximum allowance for a one-month period may not exceed € 1,200.

The leave will be granted to one of the two parents and if one parent receives the said leave, the other party cannot obtain a corresponding leave at the same time.

Parents on child care will be granted ‘special leave’ provided that the nature of their work does not permit teleworking or working from home or flexible working hours and if there is no internal assistance. The permit will be granted in consultation with the employer upon request.

The period of special leave will be considered as an insurance period (all their rights will be as if they were employees).

• Payment of ‘’sick leave’’

The payment of sick leave will be given to:

➢ Cases of compulsory absence from work by persons instructed or instructed by the Authorities (Category 1

[compulsory medical restriction surveillance (quarantine)]

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and Category 2 [self-restraint under telephone surveillance]), provided that restricted workers hold a certificate issued by the Ministry of Health

➢ Cases individuals facing particular health problems within the directory that has been prepared by the Ministry of Health, and who must be absent from work for health protection purposes. Their personal physician is required to issue a certificate.

➢ Cases of individuals beyond the age of 63rd year until the age of 65 year, who do not receive a statutory pension and continue to work and which fall under the categories 1 and 2 of the Health Ministry, provided that restricted workers hold a certificate issued by the Ministry of Health.

It is noted that for aid purposes for the self-employed, the sick leave benefit will be paid as to employees from the fourth day.

The sick leave payable to beneficiaries will be calculated as follows:

i. For employees and self-employed persons who qualify for insurance under the Social Insurance Act at 60% of the value of the units of insurance under the above Law.

ii. For employees who are not eligible under the Social Security Act and are insured with the Social Insurance Fund in January 2020, the January 2020 salary (insured earnings) or the last salary for which they are present will be considered. in the register of Social Insurance Services and will be paid special sick leave, the amount of which will be determined by a subsequent decision.

iii. For a self-employed person who is not eligible for insurance, 60% of the weekly amount of his insurable earnings based on the income for which he was required to pay contributions to the Social Insurance Fund in the fourth quarter of 2019.

iv. The maximum amount that can be paid as a special sick leave for private sector employees and self- employed for a period of one month may not exceed € 1,214. OTHER MEASURES

• Introduction of maximum price in personal hygiene products prices (masks, antiseptics, etc.) to avoid issues of profiteering.

• Necessary personnel in the Public Service: The Public Service and the wider public sector will work:

i. where possible from home

ii. with emergency personnel and for emergency services.

• Overseas Student Residence Allowance – A € 750 allowance is provided to cover the costs of students attending overseas universities who will not return to Cyprus during the Easter holiday.

• Temporary suspension of the process of divestments by KEDIPES for a period of 3 months.

• Mandatory suspension of business for a period of four weeks

• Extension for 3 months of the obligation to submit the necessary supporting documents from interested parties who have already applied for membership in the “Home Plan’’.

• Suspended evictions for a period of three months until 31η May 2020. Each process to recover possession which began after 1st of March 2020 is suspended until 31 May 2020 and no recovery decree will be issued by the Court until May 31, 2020. The arrangement does not

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provide for a suspension of rent payment, which may be voluntarily agreed between the tenant and the landlord.

• From March 16, 2020 from 6 am and for a period of four weeks, the following businesses shall be suspended:

➢ Shopping malls and department stores

➢ cafés, bars and all caterers with the exception of those that offer or have the ability to offer delivery services

➢ Clubs

➢ Cinemas, theaters and auditoriums

➢ Libraries , museums, archaeological and historical sites

➢ Gaming agencies, casinos, etc

➢ Sports facilities, sports clubs, cultural clubs and clubs

➢ Theme park (amusement park etc.)

➢ Barbers, hairdressers, beauty salons , massage, etc

➢ Hotels (suspending work until 30/04/2020)

➢ Markets,hawkers and bazaars

➢ Constructions other than those relating to public interest projects for which it is issued a license from the Minister of Transport, Communications and Works.

➢ Places of worship, such as churches, mosques and other spaces for prayers

➢ Operation of all retailers is postponed except :

Disability and orthopedic companies and laboratories

Businesses and laboratories for medical and industrial gases and machinery

Optical companies and laboratories

companies selling hearing aids

Garages for cars and motorcycles

Tire dealers

Bicycle trading and repair companies

Cleaners

Postal services and transport services (courier)

Companies selling pet animals, animal feed or veterinary

Telecommunication service providers, as it relates to bill payment services, balance renewal, repair and replacement of mobile devices

Pesticides, fertilizers and pesticides trading companies, materials or equipment

Businesses for the sale of cars and motor vehicles

Funeral Offices Τα γραφεία τελετών (κηδειών)

Nurseries and florists

It is noted that all retail businesses, including the above, may provide e-commerce or home delivery services.

All other companies that do not fall under the above categories of compulsory suspension may continue to operate as long as they strictly adhere to the rules of hygiene and protection of staff and space.

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Finally, it is noted that the custom of the “fire” is forbidden. Responsibility for enforcing this prohibition rests with the local authorities in cooperation with the Police.

➢ From 3am of March 21, 2020, for a period of 14 days, all flights to and from the airports of the Republic are prohibited, except in the case of the need to transport overseas nationals for medical or short-term stays, for business or service reasons. , the Republic of Cyprus will proceed with chartering of special flights from Athens and London. It is emphasized that citizens included in the aforementioned categories who will return to Cyprus either submit a medical certificate of coronavirus examination or a Certificate of Diplomatic Missions and for a period of 14 days will necessarily remain in compulsory confinement (quarantine) places designated by the State, persons who are abroad for medical reasons and who will remain at home in order to continue their treatment without interruption

• Emergency Measures by Financial Institutions and Supervisory Authorities Law – Refers to the suspension or obligation to pay installments including interest on credit facilities granted and / or purchased and / or managed by financial institutions.

For more details of the special plans and applications you can visit the special website of the Ministry of Labour Welfare and Social Insurance at: www.coronavirus.mlsi.gov.cym .

The House of Representatives will meet again on Thursday, 02/04/20, to approve a bill on government guarantees of € 1.75 billion to banks for new loans to businesses and self-employed workers and interest rate subsidies on existing serviced loans with an amount € 250m.