Cyprus Tax Overview

Cyprus’s tax system is similar to that of the UK. There is a double taxation agreement between the two countries, meaning that tax is paid in one or other country, not both, and usually where the higher tax is levied.

Income tax: is charged only on income earned in Cyprus. This includes income from letting property, which is taxed in progressive rates of up to 30%, depending on level of income.

A foreign national staying in Cyprus for more than 180 days during a tax year (1 January to 31 December) is considered a resident. The 180 days need to be consecutive. Residents are subject to progressive taxation on worldwide income, with the highest rate at 30%

Investments are taxed at 5% and Corporation Tax is 10%. These are among the lowest taxes in Europe.

Capital Gains tax: at 20% is based on the increase in the price of the property. In addition, the full value of the property may be transferred abroad out of Cyprus at the time of completion, if you are selling.

Inheritance tax: There is no inheritance tax or Gift Tax in Cyprus. This was abolished in January 2000

Property taxes- are circa €250 p.a. for properties over €170,000

Municipality Tax: there may also be an annual charge levied by the municipal authorities of circa €150, dependent on property size and type

Stamp duty: Is levied at 0.50% for properties under €170,000 and 0.20% for properties over €170,000. So for a villa priced at €250,000 this will be approximately €500
 

VAT: VAT at 15% on new-build properties only. (A reduced rate of 5% VAT is charged on some products, mainly food and agricultural products)