Cyprus business expenses

[jay957]

Hi,

I'm setting up a Cyprus company and will be travelling a lot under the 60d residency.
It will be an investment company and some travel will be required.
I read that I can reimburse employees up to 250 EUR/d lump sum of travel costs without tax implications (but deductible for the company).
How much do I need to prove that the travel was necessary for the company?
Eg, I go to Austria for a week to talk to another investor about interest rate expectations, which is relevant but going for a week feels like a stretch.

What if the travel is on behalf of the business but not for the generation of taxable income.
Eg going to a shareholder meeting of a company in which my company holds shares. It would determine whether I buy or sell my stock in the company but stock gains and losses aren't taxable in Cyprus anyways.

thanks

 

[clemens]

You must have receipts from restaurants and hotels, and if possible let your customer or business partner sign on the receipt from restaurants.

I believe the Cyprus tax auth. isn't that picky about it, but you never know.

@CyprusLaw @CyprusLawyer101 may know better.

 

[jay957]

Hi Clemens,

thanks for your response.

but this is from the Cyprus tax authority booklet on benefits in kind and looks a lot like I wouldn't need actual receipts for any travel related expenses (up to 250 EUR per day)

https://www.mof.gov.cy/mof/tax/taxdep.nsf/All/A00D128D410DB3F8C2258526003AFDE7/$file/Informative%20Guide%20for%20Fringe%20Benefits.pdf?OpenElement

Point 6.4.2:
(See near the bottom in bold)

"
The total cost of business travel is not a benefit in
kind. This cost includes the cost of tickets,
accommodation, meals and other costs deemed
necessary for participating in the business trip in
question. Business travel includes trips undertaken
for marketing purposes, business transactions,
participation in business seminars, temporary
placement of an employee outside the Republic
and other similar purposes. Participation in
educational programs abroad is excluded, subject
to the conditions for the exemptions for the
programs and scholarships listed below (see
Chapter 7: Exemptions). When the private part of
the trip is very small and incidental, it will be
disregarded. However, when the private part is
substantial, such as when the employee is
accompanied by family members or the duration of
the stay is quite long in relation to the business
purpose of the trip, then it will not be considered as
a business travel and the full cost will be considered
as private cost.
Please note that if a lump sum of up to €250 per
day is given which is associated with the normal
travel costs, is not considered a taxable benefit.
However, if the actual cost covered by the employer
and an additional amount is granted as a per diem,
then this is a taxable benefit.
It is clarified that it is also not a benefit in kind any
cost that arises for business trips within the
Republic to another city, if deemed necessary.
"

 

[clemens]

I see, I may be wrong then. Mabe @CyprusLaw @CyprusLawyer101 or @CyprusBusiness can help here?