Cyprus Tax Authorities publish 10-year government bond yield rates for NID purposes

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EY Global

4 Feb 2022
Subject Tax Alert
Categories Corporate Tax
Jurisdictions Cyprus

Executive summary

On 3 February 2022, the Cypriot Tax Department issued an announcement (pdf) which lists the 10-year government bond yield rates as at 31 December 2021 for a number of countries (listed on the table below) with respect to the Notional Interest Deduction (NID) on equity. These yield rates are to be used to determine the reference interest rate for claiming NID for the 2022 tax year.

The key NID provisions and the applicability of the 10-year government bond yield rates are summarized below.

Detailed discussion

Notional Interest Deduction

As of 1 January 2015, Cyprus tax resident companies (as well as foreign companies with permanent establishments in Cyprus), which carry on a business, are entitled to claim a NID on their equity capital introduced on or after 1 January 2015.

The NID is deducted from the taxable income of the company for the relevant tax year (subject to any restrictions) for the period of time during which the equity is used by the company for the carrying on of its activities. The NID is subject to a number of conditions, including a taxable income limitation.

The NID equals the multiple of the “reference interest rate” (as defined below) and ‘’new equity.’’

“Reference interest rate” means the 10-year government bond yield as of 31 December of the year preceding the tax year of the country in which the new equity is invested increased by 5%.

10-year government bond yield rates as of 31 December 2021 (applicable for 2022 tax year)
Country Yield rate Country Yield rate
Abu Dhabi N/A* Italy 1.170
Albania N/A* Ivory Coast N/A*
Argentina 3.508 Jordan (US$) 5.631
Armenia 9.722 Kazakhstan (€) 1.444
Australia 1.670 Kazakhstan (US$) 2.107
Austria 0.072 Kenya 12.660
Azerbaijan N/A* Latvia 0.323
Belarus (US$) 9.785 Lebanon N/A*
Belgium 0.180 Lithuania 0.259
Bermuda (US$) 2.376 Luxembourg 0.129
British Virgin Islands N/A* Morocco 2.239
Bulgaria 0.690 Mauritius 4.200
Canada 1.479 Netherlands 0.035
Cayman Islands N/A* Nigeria 12.607
Chile 5.652 Nigeria (€) N/A*
Chile (US$) 2.560 Norway 1.699
Chile (€) 0.834 Poland 3.646
China 2.775 Portugal 0.462
Costa Rica 6.363 Romania 5.146
Croatia 0.560 Russia 8.390
Cyprus 0.629 Russia (US$) 1.994
Czech Republic 2.797 Saudi Arabia 2.932
Denmark 0.061 Serbia 4.126
Dubai (€) N/A* Singapore 1.638
Dubai (US$) 2.533 Slovakia -0.083
Egypt 14.913 Slovenia 0.349
Egypt (US$) 7.570 South Africa 9.799
Estonia 0.122 Spain 0.563
Finland 0.082 Sweden 0.220
France 0.195 Switzerland -0.153
Germany -0.206 Taiwan 0.700
Guernsey N/A* United States 1.512
Greece 1.315 Ukraine (€) N/A*
Hong Kong 1.524 Ukraine (US$) 8.902
Hungary 4.484 United Arab Emirates N/A*
India 6.509 United Kingdom 1.020
Ireland 0.237    
Isle of Man 1.502    
Israel 1.290    
Israel (US$) 1.919    

* There are currently no government bond yield rates for the above indicated countries.


For additional information with respect to this Alert, please contact the following:

Ernst & Young Cyprus Limited, International Tax and Transaction Services, Nicosia
  • Petros Krasaris
  • Elina Papaconstantinou

For a full listing of contacts and email addresses, please click on the Tax News Update: Global Edition (GTNU) version of this Alert.