Debt settlement schemes bring in € 747 million for the state

Economy economytaxTop News Debt settlement schemes bring in € 747 million for the state Foros Xrimata (1) Relevant News Debt settlement schemes bring in € 747 million for the state 12 July 2026 Cyprus firefighting aircraft return from France after wildfire mission 12 July 2026 About 300 people evacuated in Paris suburb due to ‘suspicious’ car near synagogue 12 July 2026 Eleftheria Paizanou 12 July 2026 FacebookXWhatsAppEmailPrintViber Debt settlement schemes for overdue tax liabilities and contributions to the Social Insurance Fund generated €747 million in state revenue from debts exceeding €1 billion. The Tax Department collected €647 million through schemes covering tax debts, while a further €100 million came from similar arrangements for overdue social insurance contributions. The schemes allowed persistent debtors to repay liabilities that the state might otherwise never have recovered, or would have collected only after lengthy court proceedings. Debtors received reductions in interest and penalties depending on the number of instalments they selected. Those who settled their liabilities in a single payment received a 95% reduction in the additional charges imposed on the original debt. More than €1 billion in tax debts The tax debt settlement schemes were introduced in 2017 and remained in place until 2025. Arrangements were created exclusively through the government’s CyLogin portal, with payments made electronically. The schemes aimed to make it easier to repay taxes relating to tax years and periods up to 2015, offering reductions in financial penalties according to the number of instalments chosen. Since May 2024, the Tax Commissioner has also been able to consider applications submitted after the relevant deadline, provided applicants had filed all outstanding tax returns by the date of their application. The Tax Department also allows VAT-registered businesses whose turnover fell by at least 25% in 2020 compared with 2019 to settle debts covering tax periods from January 1, 2016, to December 31, 2019. 48,000 debtors initially joined A total of 48,000 debtors initially entered the schemes, settling debts of more than €1 billion owed to the Tax Department. After the arrangements and discounts were applied, the total value of the debts fell to €844.3 million. A total of 4,247 debtors, with combined liabilities of €273.6 million, were later removed from the schemes after failing to comply with their terms. More than 43,000 active arrangements remained, covering initial debts of €773.7 million. After discounts, that amount fell to €618.2 million. Most of the revenue came from settlements involving income tax, which accounted for 59.8%, and the special defence contribution, which represented 27.9%. According to Tax Department data, 1,509 arrangements were created last year, covering €38.4 million in taxes and penalties. After discounts, the amount fell to €27.4 million, of which €17.2 million was paid. Around 85% of the arrangements created in 2025 were settled in a single instalment, covering €14.3 million in taxes and penalties after discounts. Strong interest in new social insurance scheme The state collected €100 million through two previous schemes for overdue social insurance contributions, out of total debts of €225 million. About 10,900 debtors initially joined the two schemes, but more than half later withdrew or were removed after failing to meet their commitments. A third scheme has been in place since May and aims to regulate €245 million in overdue contributions to the Social Insurance Fund. Applications may be submitted until September 14. A competent source told Phileleftheros that there was strong interest among eligible debtors. The new scheme is open to employers and covers liabilities up to February 2026. It also applies to self-employed people with debts dating up to the fourth quarter of 2025. Subscribe to our Newsletter Latest News Cyprus firefighting aircraft return from France after wildfire mission About 300 people evacuated in Paris suburb due to ‘suspicious’ car near synagogue Cyprus temperatures to stay at 40°C as yellow warnings expected through Wednesday Ukraine’s Zelenskiy dismisses Prime Minister Svyrydenko after only a year Police arrest 14 people in Nicosia over illegal employment Four arrested in Nicosia over drink-driving offences; two refused to provide breath samples Isaac-Solomou memorial ride reaches Karavas in Kythera Follow en.philenews on Google News and be the first to know all the news about Cyprus and the world.