Cypriot football clubs are facing heightened scrutiny due to €30 million in tax and social security debts owed to the state. The Tax Department has placed four clubs—APOEL, Apollon, Anorthosis, and Ethnikos Achnas—under strict examination for their compliance with these obligations. Following an ultimatum from the government and their reintegration into a tax debt payment plan, the authorities are now monitoring their commitment to settle these debts.
Tax debts: Current Payment Status of the Clubs
All four clubs have been adhering to their payment schedules for July, and officials from the Tax Department are now assessing whether they will maintain compliance this month. The total tax debt accumulated by these clubs is approximately €19.8 million, which constitutes over 50% of the total debt owed by 15 football companies to the state, exceeding €30 million.
Consequences of Non-Compliance
Sotiris Markides, the Commissioner of Taxation, has made it clear in discussions with club leaders that non-compliance will lead to necessary actions, including legal measures and potential charges against current and former administrative officials. According to the 2023 repayment plan, the clubs are expected to clear their tax debts by 2037, although some clubs have already settled their debts.
Repayment Plans for Each Club
APOEL’s Strategy
APOEL’s total tax debt stands at €11.6 million, with a monthly payment of €75,000. The club began the year with outstanding debts of €1.8 million. As part of their repayment proposal, they have already paid €700,000 by cheque and plan to pay an additional €200,000 by the end of September. With these payments, the repayment percentage of their outstanding debts would reach 48%.
Commissioner Markides acknowledged APOEL’s serious efforts to meet its obligations, noting that the club is undergoing revisions in its operational processes and budget management. He has recommended their reinclusion in the 2023 repayment plan with an adjusted installment amount based on future payments.
Apollon’s Plan
Apollon has a tax debt of €3.8 million, with a current outstanding amount of €1.3 million. They have already made an immediate payment of €150,000 and an additional €350,000 by the end of April. They have committed to another €200,000 payment by September 1, with the remaining amount to be included in the monthly instalments of the tax repayment plan. Commissioner Markides has stated that Apollon’s repayment percentage will reach 53%, and he supports their reinclusion in the payment plan.
Anorthosis’ Approach
Anorthosis is working to settle a total tax debt of €3.2 million, starting the year with €650,000 in outstanding payments. Their monthly payment is set at €22,000. They proposed an immediate payment of €200,000, and with further commitments, their repayment percentage is expected to reach 62% by September 1. The Tax Commissioner has recognised their serious efforts, particularly following a board reshuffle last October.
Ethnikos Achnas’ Situation
Ethnikos Achnas has accumulated a total tax debt of €1.2 million, with outstanding debts of €101,000. They are making monthly payments of €8,000 and have proposed to divide their VAT debt into 147 remaining instalments. The Tax Commissioner has recommended their reinclusion in the payment plan, acknowledging their compliance and unique status as a refugee club facing financial difficulties.
Social Security Debt Challenges
While tax debts are significant, the clubs are also grappling with social security debts that total €12 million. The lack of a regulatory framework for overdue social contributions means these debts must be settled immediately. Currently, 18 clubs have not cleared their social security debts and are not included in any repayment plan, while only one, Ethnikos Achnas, is part of such a plan.
The debts to the Social Security Fund for several clubs are as follows: APOEL with €5.4 million, Apollon with €2.86 million, AEL with €963,000, and Anorthosis with €1.11 million. Other clubs have also reported smaller debts, indicating a widespread issue across the league.
Tax Compliance Among Other Clubs
In contrast, several football companies have managed to remain tax-compliant. These include Pafos FC, Omonia Nicosia, AEK, ARIS, and others, demonstrating that compliance is possible amid the financial challenges many clubs face.
As the Tax Department continues to monitor the financial health of Cypriot football clubs, the focus remains on ensuring compliance with tax and social security obligations, paving the way for a more sustainable future for the sport in the region.
