The Cypriot Ministry of Finance announced that the Cabinet has passed a bill amending the Income Tax Act, providing for an additional tax exemption in the form of a capital deduction for certain investments for Cypriot companies wishing to implement a range of energy saving measures.
According to the announcement, companies looking to drive energy efficiency in their building will be eligible for an increased capital deduction of 7% instead of the 3% allowed under the existing regulatory framework. Additionally, the announcement clarified that this applies to certain investments made in tax years 2023, 2024 and 2025. In addition, an increased capital allowance of 20% instead of 10% under the existing legal framework will be granted to companies for machinery and equipment connected to renewable energy systems and technical systems to improve energy efficiency.
