Carrying Forward Business Losses

Entrepreneurs and businesses in Cyprus have the advantage of carrying forward losses incurred within a tax year to the following five years. This provision allows these losses to be deducted from future taxable profits, aiding in tax planning and management.

Conversion of Business Entity

In the event of transforming a sole proprietorship or partnership into a limited liability company structure, Cyprus tax law permits the transfer of any remaining tax losses to the newly formed company. This facilitates the continued utilization of tax losses without forfeiture due to changes in business structure.

Foreign Permanent Establishments Loss Offset

For businesses operating with permanent establishments abroad, Cyprus tax regulations allow the offsetting of losses from such entities against the profits earned within Cyprus in the same fiscal year. It should be noted, however, that any future profits from the overseas establishment that had previously been balanced against losses will be subject to taxation, up to the level of losses that were utilized.


Please note that the information provided here is for general guidance only and does not constitute professional tax advice. Tax laws and interpretations are subject to change, and individual circumstances can significantly affect tax obligations and benefits.

Contact Us

For personalized tax advice tailored to your specific situation, we strongly recommend consulting with a qualified tax professional. Our team is equipped with the expertise to navigate the intricacies of Cyprus tax law and provide you with customized solutions. Contact us to ensure that you are making the most informed decisions for your tax-related matters.

Got a question? Get in touch

Stay informed