One of the most significant changes for businesses is the increase in the Special Contribution for Defense of dividends of companies from 15% to 20%. The growth for the rate for the special contribution for defense would be for a period of two years.
It is worth to mention that no Special Contribution for Defense is deducted for dividends received from non-Cyprus tax residents. Also there is no withholding tax on dividends paid from Cyprus to abroad.
This law begins in 1 January 2012 and applies to income acquired or resulted from 1 January 2012 and until 31 December 2013.