Filenews 21 June 2023 - by Eleftheria Paizanou
Without a tax file were over 69,000 'taxpayers' from 2018 to 2020 despite paying contributions to the Social Insurance Services (YKAs).
In fact, these taxpayers declared that they had an annual income of less than €19,500 in order not to submit tax returns, even though their data was included in the system of Social Security Systems. Also, there are persons who do not have an income tax file, while others are registered in the system of the Inland Revenue Department with different identity data to those registered in the CAA system.
According to the report of the Audit Office for the Tax Department, out of the 24,265 inconsistent taxpayers identified in 2020, it carried out audits in 60 cases that declared income in social insurance beyond €50,000. Of these, 18 cases of salaried employees were unknown to the tax, however they work in the state machine and do not file tax returns. During the audit carried out in March 2023 on the 18 employees, one person works in a semi-governmental organization, one in the army and three are commercial attachés or representatives in embassies of the Republic of Cyprus abroad or in international organizations and at the date of the audit they did not have a tax file.
In addition, during the audits, a company was identified that was registered in the Register of the Registrar of Companies on 1.12.2007 and in the VAT Register on 16.12.2008, but to date (May 2023) does not have a direct tax file and does not submit income tax returns, while showing turnover.
Another company had a total turnover of €20.4 million, while reporting revenues of €4.3 million. Also a specific company, for 2018 had a total turnover of €13. 6 million, however, the turnover declared for income tax purposes amounts to €10. 2 million
Accountants without declarations
In addition, 1804 natural and legal persons registered in the ICT system with the activity of "Accountants/Auditors" did not file tax returns for any year, even though 93% are active taxpayers. The Audit Office found that there was a delay by taxpayers in submitting their income returns, since 350 companies and 44 individuals active in the field of accountants submitted income declarations until 2010, while 213 companies and 53 individuals only until the year 2015. Also, cases were identified of accountants who declared a different turnover for income tax purposes than the one they declared in VAT (15%).
Suddenly he became a director
During the audits, the Audit Office found that in 2015 a taxpayer who declared himself as an unemployed accountant and that he was in a difficult financial situation, in the period 2014-2020 was a shareholder director in two companies supplying medical products, which had revenues of €3 million from the state.
In addition, the taxpayer also invested in a restaurant and at the same time was a shareholder in six other companies, for which he did not submit income returns. The Tax Department found that this taxpayer had additional income of €186,700, resulting in a tax of €35,000.
