When there is a change in the VAT rate, any transactions effected before the date that this provision will come into force will be subject to VAT at the rate of 9% even if they actually relate to the period from 01/07/2020 to 10/01/2021, while any transactions that take place after the change in VAT rate will be subject to VAT at the rate of 5%.
Where the actual tax point and the basic tax points straddle the change in VAT rate the taxpayer has the option to choose which rate to apply to a particular transaction:
• for any advances received and invoices issued before the change in the VAT rate, the old rate will apply
• for any services supplied before the change in the VAT rate, but where an invoice is issued within 14 days from the date of the transaction there will be a choice to apply the old or new rate.
Source: PwC Cyprus
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