Filenews 9 January 2026 - by Angelos Angelodimou
Cypriot businesses are on high alert due to the changes brought about by the tax reform. The accounting departments of the companies are working feverishly to adjust the new data on the salaries of each employee by the end of the month, when the next payments will be made. However, as we are informed, several points need clarification and therefore delays are constantly occurring.
More specifically, as expected, with the approval of the tax reform, new data are created, both for companies and for employees. Therefore, the accounting departments of companies will have to adapt the payroll part for employees to the new realities. Whether it concerns cuts or tax-free, new forms and more. And this must be done by the end of the month, when the next payments will be made.
But the changes are so many that questions inevitably arise, which need clarification. Having ascertained the above, OEB is proceeding with a two-day information event to its member companies, in collaboration with the office of the Tax Commissioner. As informed by the General Director of the Federation, Michalis Antoniou, a race will begin for the timely information of employers with the aim of the correct implementation of the tax changes.
In particular, OEB informed that, in collaboration with the Office of the Tax Commissioner, they will hold informative Webinars entitled "Tax Changes in the Taxation of Natural Persons", in order to present the changes that have arisen from the recent Tax Reform and which affect the taxation of Natural Persons and more specifically, the declaration for claiming tax deductions for the tax year 2026 (Form Τ.F. 59).
The Webinars are mainly aimed at business executives with responsibilities for employee payroll management and can participate more than one person from each company. For the convenience of all interested parties, OEB informed that the Webinars will be held with the same content on the following two dates, through the Zoom online platform: Thursday, 15/01/2026, at 09:00-11:00 a.m. and Friday, 16/01/2026, at 09:00-11:00 a.m. It is noted that at a later stage, OEB in collaboration with the Office of the Tax Commissioner will schedule informative presentations on the other changes of the Tax Reform related to the activities of businesses.
Information to employers
In the meantime, yesterday, on the occasion of the relevant circular of the Ministry of Economy, OEB and CCCI informed their members in relation to the changes brought about by the new agreement on the ATA. Specifically, it is noted, among other things, that the fluctuation of the Consumer Price Index (excluding consumption taxes) for the year 2025 recorded an increase of 0.13%. According to the Permanent Agreement concluded between the Social Partners on November 13, 2025, on January 1, 2026, salaries will be adjusted with 80% of the annual increase of the Index, provided that during the previous year there is a positive growth rate.
In addition, the Agreement provides that on July 1, 2026, salaries will be adjusted with an additional 10% of the annual increase of the Index (a total of 90%). Consequently, the ATA as of January 1, 2026 is increased by 0.10% on the total salaries in force on 31/12/2025 or from 12.56% to 12.67% on the basic salaries. As of July 1, 2026, the above percentages are as follows: 0.12% (additional 0.02% on the total salaries in force on 31/12/2025) or 12.70% (additional 0.03% on basic salaries).
In fact, presenting specific examples, OEB states: In a total salary of €1,500 on 31/12/2025, an indexation allowance of €1.50 will be given for the first six months of 2026, while from July and the next 12 months the allowance will amount to €1.80. For a basic salary of €1,500 on 1/1/2026, the indexation allowance of 12.67% means an increase of €190.05 for the first six months, which becomes €190.50 in the next 12 months. OEB notes that the above examples do not take into account any general increases and/or surcharges granted during the period 2018-2025.
