Self employed / Sole trader | Confused with tax and expenses

Last activity 19 April 2023 by phildraper

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vinkonicNew member10 April 2023 17:49:50

I am currently employed by a company in Germany. In June I will move to Cyprus, register as a self-employed person and invoice the company in Germany on a monthly basis. This means that I will continue to work remotely for them. (I work in marketing).

But now I am very confused about the issue of taxes and other expenses. Which expenses will I have to pay to whom and when? I would have just VAT, income tax and social security contributions in mind. Is there anything else to add?

Now I have also heard something about "EU VAT rules for a VAT exemption" under the following conditions:

You are providing a service to a business customer (i.e., not a consumer) in another EU member state.
The customer is registered for VAT in their country.
The service is used for the purposes of the customer's business.
The place of supply is deemed to be in the customer's country.

As far as I understand it, these 4 points apply to me. So I don't have to calculate VAT at all?

The topic is relatively complicated for me to understand, as the information on it is also very scattered but apart from that I think that in principle, as a self-employed person, this is feasible without a tax advisor. I would not like to get me one, because they are relatively expensive.

Can someone explain to me when I have to make which expenses where and what I have to pay attention to in my invoices?

ToonCyprus Expert10 April 2023 18:41:55

9880

I would suggest the safest route to take is a professional. Getting the wrong advice could be very costly

kyrikitMember19 April 2023 10:02:19

I agree with Toon, get your self an accountant. I think you only have to pay tax on what you earn (profit) the best thing you can do is get an accountant. If you trip up on these things the Greeks will come at you like hound dogs!

Good luck 🤞

phildraperSerial expat19 April 2023 11:26:29

439

I would also recommend the professional engagement. However, I would expect you will need a work permit if you are self employed in Cyprus. You will need to engage a professional to submit income/expenditure at the end of the tax year in Cyprus. Therefore probably best to get one now and start off on the right foot.

Another idea might be to create a company outside of the EU and work remotely for that company. That way no work permit needed as you will be a remote worker. You will still need to pay tax in Cyprus on your earning but if you take dividends rather than a salary these would be tax free in Cyprus. I understand you can earn up to about 20k in Cyprus before having to pay tax so if you are over this then the dividend option might be better even taking into account the company formation and additional accountancy fees for the company. You will need to run this by an accountant for sure. There are some accountant that have offices in Cyprus and also outside of the EU.

ToonCyprus Expert19 April 2023 12:12:15

9880

@phildraper great info

ToonCyprus Expert19 April 2023 12:14:05

9880

If the new president gets his way he is to increase the tax free allowance from €19500 per yr per person to €24500 per yr per person.

phildraperSerial expat19 April 2023 12:41:46

439

Whoop whoop lol

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