Dormant company in Cyprus: what you still have to file when you are not trading

A dormant Cyprus company, one that sits on the register without trading, still files almost everything a trading company files. Every year it submits the HE32 annual return with financial statements attached, those statements carry a statutory auditor's sign-off, and it files a corporate tax return even when the figure on it is nil. The one recurring cost that genuinely disappeared is the €350 annual levy, abolished from 2024. Dormancy does not shorten the list of obligations; it makes each item on the list small.

Is a dormant Cyprus company really free of obligations?

No. The gap between what founders assume and what the law requires is where nearly every dormant-company penalty we see comes from. Company law attaches the annual filings to the company existing on the register, and the Registrar is explicit that no exemption from the annual return exists for a company that is not operating. Tax law attaches the return to the company being a taxpayer, whether or not it had income. Neither regime has a box you tick to switch the calendar off.

A company left to sit for three years without filings does not quietly disappear. It accumulates Registrar penalties and tax penalties, and eventually the Registrar, believing it defunct, can strike it off on its own initiative. At that point the tidy exit the founder imagined requires catching up on every missed year first. A dormant company is a very small compliance job, but it is a job with dates.

What does "dormant" actually mean in Cyprus?

In everyday use it means a company with no activity: no sales, no purchases, no employees, usually just a bank account with a balance and a few bank charges. That is a description of the year, and nothing more. The Registrar has no dormant flag that changes the filing requirements, and the Companies Law defines no lighter regime for inactive companies.

The Tax Department side has a little more room. Tell the department the company has ceased activity and expectations for provisional tax are set accordingly, but the annual return still falls due. If the company was VAT-registered, deregistering is worth doing once taxable supplies have stopped, because a live VAT number means VAT returns keep falling due, nil or not. Our guide to Cyprus tax deadlines lays out the calendar a dormant company is still on.

The company also keeps its statutory furniture: a registered office in Cyprus, at least one director, a company secretary and an up-to-date beneficial-owner register. Where a professional firm provides any of these, that fee continues too. It is one of the real costs of dormancy.

What must a dormant company still file each year?

The list is the same as for a trading company. Only the contents are thinner.

The HE32 annual return

Filed with the Registrar of Companies once per calendar year, within 28 days of its made-up date, for a filing fee of €20, with the previous year's financial statements attached. File it late and the penalty is €50 plus €1 per day, capped at €150 per return, and an overdue return also pays a further €20 on top of the normal fee, so a badly late year costs €190. Modest per return, but it compounds across years, and it is the filing the Registrar watches when deciding a company looks defunct. The full mechanics are in our guide to the HE32 annual return.

Financial statements

Every Cyprus company prepares IFRS financial statements and submits them for audit by statutory auditors licensed under the Auditors Law, with a review engagement available to the smallest private companies. Dormant accounts are short: a balance sheet with a bank balance and share capital, and a profit and loss with bank charges and professional fees. They are still IFRS statements, and they still have to be ready in time to attach to the HE32.

A nil corporate income tax return

The TD4 is due by 31 January of the second year after the tax year from tax year 2026, and 31 March of the second year for tax years through 2025. A dormant company files a nil return by that date; having no income only makes the form quick to complete. From 2026 a company that files late owes a fixed €250 penalty, which is a lot to pay for not filing a form full of zeros.

Provisional tax

Provisional tax is an advance payment on the profit the company expects this year, estimated by 31 July and paid in two instalments on 31 July and 31 December. A company expecting no profit files no estimate and pays nothing, and with no final tax there is nothing to surcharge. The year to be careful is the year the company wakes up: file no estimate in a year that ends in profit and the 10% underestimation surcharge applies to the whole final tax. Our guide to provisional tax in Cyprus covers the estimate and the revision window.

What happened to the annual levy?

It was abolished. For years the €350 levy was the most resented fixed cost of keeping a dormant company on the register, and it was abolished from 2024 by Law N.25(I)/2024. The same announcement is clear that levies for 2011 to 2023 still apply, so a company that was already dormant in those years may have arrears the Registrar can still collect. Check the history before filing anything else, because unpaid levies also block a clean exit later.

Does a dormant company still need an audit?

It still needs a licensed auditor to sign off its financial statements, and in most dormant cases that sign-off is the lighter, cheaper review engagement rather than a full audit.

The review option is open to private companies with net turnover of €300,000 or less and gross assets of €500,000 or less, both met for two consecutive financial years, the turnover limit having been raised from €200,000 with effect from 6 February 2026. A dormant company with a modest bank balance and no revenue passes both limbs easily. The test looks at two consecutive years, though, so a company that was large before it went quiet may need a year of small numbers before it qualifies. And a review is still performed by a licensed auditor and still produces signed statements attached to the HE32: a lighter procedure with the same professional sign-off, since the Companies Law contains no separate dormancy exemption. Our explainer on audit requirements in Cyprus covers who qualifies and what the reviewer looks at.

When does keeping the company dormant make sense?

Keep the company when it holds something worth preserving and you have a credible plan to use it again. The valuable things are rarely on the balance sheet: the company's age, its clean filing history, its bank account and the relationship behind it, its tax registrations, any licences or contracts in its name, and the plain fact that it can invoice tomorrow. A founder pausing between projects, a holding company waiting for its next investment, a seasonal business: these are the cases where a year or two of thin filings is money well spent.

If the pause is really an ending, every year of dormancy is registered-office fees, secretary fees, a review engagement and filings spent preserving an option nobody intends to exercise. Compare that against strike-off, which wins on cost over any horizon longer than a couple of years, and against the cost of a fresh formation and bank account later if you turn out to need one after all.

How does strike-off work, and when is it the better choice?

Voluntary strike-off is the orderly way to remove a company with nothing left in it. The company distributes or settles everything so it holds no assets and no liabilities, brings its Registrar filings up to date, clears its position with the Tax Department, Social Insurance Services and creditors, and files form HE60 with a €20 fee; the Registrar publishes notice in the Gazette and, with no objection within three months, strikes the company off. In practice the whole route takes a few months from publication. Our guide to closing a Cyprus company walks through it step by step.

Strike-off requires the company to be clean first, so filings already missed get caught up on the way out. A company with real creditors or disputed assets needs liquidation instead, and restoring a struck-off company means an application to the Registrar within 24 months at best and a court application after that. Empty the company first: on strike-off, any remaining assets and rights pass to the Republic as ownerless property. That applies equally when the Registrar strikes off a non-filing company on its own initiative, which is why a dormant company with money still in the bank should never drift into missed filings.

How do you keep a dormant company cheaply compliant?

Make the bookkeeping trivial and buy only the sign-off the company actually needs. A dormant company's year is a few dozen bank lines: charges, the auditor's invoice, maybe some interest. Connect the account to Sumly by read-only open banking and Sumly matches and books each line as it lands, so the books are always finished and the year-end statements and nil TD4 figures come straight out of them. On the Base plan, from €39 a month, you review and file yourself; on Premium a Sumly certified bookkeeper submits through Tax For All. You order the review or audit in the dashboard, and the partner auditor gets their own login to work from the same books, which for accounts this thin makes the engagement about as short as it can be.

The other half is the calendar. The HE32 made-up date, the TD4 deadline and the provisional tax dates repeat every year, and every late penalty a dormant company pays is a reminder that nobody was watching them. Set reminders a month ahead of each, review what the registered office and secretary cost annually, deregister for VAT if taxable supplies have stopped, and check the accounts are on a review rather than a full audit if the company qualifies.

What does reactivating a dormant company involve?

Less than forming a new one, which is the point of having kept it. Tell the Tax Department the company is active again and file a provisional tax estimate if profit is expected. Re-register for VAT if the company deregistered and will make taxable supplies. Check the bank account is live and the bank's know-your-customer file is current, because a long-dormant account can be restricted. Then pick the bookkeeping up from the last signed balance sheet, which becomes the opening position for the new activity.

The reactivation year rewards discipline. A company that restarts in the autumn still files one set of accounts for the whole year, and its provisional tax position is judged against the full-year result. Clean dormant-period books, however thin, make the restart a continuation instead of a rebuild.

Questions founders actually ask

Frequently asked

Does a dormant Cyprus company have to file an annual return?

Yes. The HE32 annual return attaches to the company being on the register, whether or not it traded. A dormant company files one HE32 every calendar year, with the previous year's financial statements attached, pays the €20 filing fee, and faces the same late penalty as a trading company: €50 plus €1 per day, capped at €150 per return.

Does a dormant company in Cyprus still need an audit?

Its financial statements still need sign-off from a statutory auditor licensed under the Auditors Law. Cyprus has no dormancy exemption. Most dormant companies qualify for the cheaper review engagement instead of a full audit, because the test is net turnover of €300,000 or less and gross assets of €500,000 or less, both met for two consecutive years. Ask the auditor to confirm the company qualifies rather than assuming it.

Do I file a corporate tax return if the company made nothing?

Yes. A company with no income files a nil TD4 by the normal deadline: 31 January of the second year after the tax year from tax year 2026, 31 March for tax years through 2025. Skipping the return because there was nothing to report is the most common way a dormant company picks up penalties, and from 2026 a late company return carries a fixed €250 charge.

Is the annual company levy still payable on a dormant company?

No. The €350 annual levy was abolished from 2024 by Law N.25(I)/2024, so that fixed cost is gone. Levies for 2011 to 2023 still apply, so a company that was already dormant in those years should check whether old levies are outstanding before it files anything or applies for strike-off.

Is it cheaper to strike the company off than to keep it dormant?

Over several years, usually yes. Voluntary strike-off costs €20 on form HE60 and ends all future filings, but the company must first be fully up to date with the Registrar, the Tax Department and Social Insurance. Strike-off also gives up the company's age, bank relationship and any contracts in its name, and on strike-off any assets left in the company pass to the Republic. Keep the company dormant if you have a real plan to use it again; strike it off if you do not.

Can Sumly run the books for a dormant company?

Yes, and it is one of the cheapest jobs we do. A dormant company's year is a few dozen bank lines. Connected by read-only open banking, they reconcile automatically, and the year-end statements and the nil TD4 figures come straight out of the books. On the Base plan you review and file yourself; on Premium a Sumly certified bookkeeper submits through Tax For All. The audit or review is ordered in the dashboard and the partner auditor works from the same books.