On 17 September 2026, the Cyprus Tax Department officially withdrew the guidance document “Cyprus Administrative Service Providers (ASPs) Are They FIs under FATCA and CRS?” originally issued in June 2017. The withdrawal follows the enactment of the amended Assessment and Collection of Taxes Law (N. 4/2026) and updated OECD CRS Implementation Handbook, which reclassify certain ASPs as Non-Reporting Financial Institutions. The department clarified that the previous guidance no longer reflects the current legal framework and directed affected entities to the new regulatory guidelines published on the Tax Portal. This change impacts trust companies, corporate service providers, and fund administrators operating in Cyprus.
Key Takeaways
- Reclassification of ASPs: Under the new rules, ASPs that are professionally managed investment entities are now classified as Non-Reporting Financial Institutions, exempting them from FATCA/CRS reporting obligations for their own accounts. However, they must still perform due diligence on underlying investors and report controlling persons where applicable.
- Updated Due Diligence Requirements: Affected ASPs must implement enhanced due diligence procedures for pre-existing accounts by 31 December 2026. This includes obtaining self-certifications from controlling persons and verifying tax residency status. Failure to comply may result in penalties of €2,500 per account.
- Transitional Reporting: For the 2026 reporting period (due 30 June 2027), ASPs must report under the new classification. The Tax Department will issue a detailed FAQ and conduct webinars to assist with transition. Entities should review their client onboarding processes and update compliance manuals accordingly.
Disclaimer: This article is compiled and summarized by the AI based on publicly available information and is for general information purposes only. It does not constitute any form of formal tax advice, legal opinion, or basis for performance. Please consult a qualified professional tax advisor or legal counsel for tax advice.
Source: Read Official Announcement