Cyprus Tax Authority publishes 10-year government bond yield rates for NID purposes

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EY Global

20 Mar 2023
Subject Tax Alert
Categories Corporate Tax
Jurisdictions Cyprus

On 16 March 2023, the Cypriot Tax Department issued an announcement (pdf) that lists the 10-year government bond yield rates as of 31 December 2022 for a number of countries (listed in the table below) with respect to the Notional Interest Deduction (NID) on equity. These yield rates should be used to determine the reference interest rate for claiming NID for the 2023 tax year.

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

Notional Interest Deduction

As of 1 January 2015, Cyprus tax-resident companies (as well as foreign companies with permanent establishments in Cyprus) that 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 company’s taxable income for the relevant tax year (subject to any restrictions) for the period of time during which the company used the equity in carrying on 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 of the country in which the new equity is invested, as of 31 December of the year preceding the tax year, increased by 5%.

10-year government bond yield rates as of 31 December 2022
(applicable for 2023 tax year)1
Country Yield rate Country Yield rate
Abu Dhabi 4.224 Jordan (US$) 7.930
Albania 6.244 Kazakhstan (€) 4.276
Argentina 6.447 Kazakhstan (US$) 4.555
Armenia 11.980 Kenya 13.880
Australia 4.050 Latvia 3.688
Austria 3.170 Lebanon N/A*
Azerbaijan 5.727 Lithuania 3.660
Belarus (US$) 25.593 Luxembourg 3.075
Belgium 3.171 Mauritius 5.880
Bermuda (US$) 5.043 Morocco 3.947
British Virgin Islands N/A* Netherlands 2.906
Bulgaria 5.516 Nigeria 13.437
Canada 3.298 Nigeria (€) N/A*
Cayman Islands N/A* Norway 3.192
Chile 5.266 Panama (US$) 5.754
Chile (US$) 5.210 Poland 6.846
Chile (€) 3.889 Portugal 3.579
China 2.883 Romania 8.282
Costa Rica 9.667 Russia 11.230
Croatia 3.894 Russia (US$) N/A
Cyprus 4.399 Saudi Arabia 3.135
Czech Republic 5.015 Serbia 7.036
Denmark 2.785 Singapore 3.102
Dubai (€) N/A* Slovakia 3.697
Dubai (US$) 4.377 Slovenia 3.781
Egypt 19.348 South Africa 10.788
Egypt (US$) 12.349 Spain 3.649
Estonia 3.637 Sweden 2.340
Finland 3.117 Switzerland 1.601
France 3.106 Taiwan 1.325
Germany 2.542 United States 3.877
Guernsey N/A* Ukraine N/A
Ghana 39.930 Ukraine (€) 32.023
Ghana (US$) 25.868 Ukraine (US$) 34.410
Greece 4.466 United Arab Emirates N/A*
Hong Kong 3.677 United Kingdom 3.665
Hungary 9.051 Vietnam 4.784
India 7.331    
Ireland 3.076    
Isle of Man 4.650    
Israel 3.580    
Israel (US$) 4.650    
Italy 4.560    
Ivory Coast N/A*    
Jamaica 6.436    

* 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:

EY Cyprus Advisory Services 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.