e-TaxCy Services

In the case of a person who is a tax resident of the Republic, tax is imposed on the income acquired or derived from sources both inside and outside the Republic.

In the case of a person who is not a tax resident of the Republic, tax is imposed on income obtained or derived from sources within the Republic only, that is:

1) any profits or other benefits from a permanent establishment located in the Republic,
2) profits or other benefits from any office or salaried services exercised in the Republic.

A person who remains in the Republic for a period exceeding in total 183 days during the tax year.

(1) Does not remain in any other state for more than 183 days within the same tax year.
(2) Is not a tax resident in any other state for the same tax year.
(3) Remains in Cyprus for at least 60 days in the same tax year.
(4) Runs a business in Cyprus or is employed in Cyprus or holds an office in a tax resident company in Cyprus, on December 31 of each tax year.
(5) Maintains a permanent residence in the Republic which he owns or rents.
It is pointed out that if during the tax year the exercise of business / employment or the holding of an office is terminated, then the person ceases to be considered a resident of the Republic for that tax year.

(1) The amount received on retirement or commutation of pension or as death gratuity.

(2) The amount representing repayment from life insurance or from approved provident funds.

(3) Interest income.

(4) Dividend income.

(5) Profits from disposal of securities.

(6) The remuneration from the provision of salaried services outside the Republic to an employer who is not resident in the Republic, or in a permanent establishment outside the Republic of an employer who is resident in the Republic, provided that the period of services abroad for a tax year exceeds 90 days.

(7) Profits from a permanent establishment maintained abroad (provided that more than 50% of the activities of the permanent establishment do not directly or indirectly yield investment income and the foreign tax is not significantly lower than the tax rate in Cyprus).

(8) Profits from the production of films, television series or other audiovisual programs. The amount is limited to the lower of 35% of eligible expenses and 50% of taxable income. The limited amount can be carried over to the next 5 years.

(9) 20% of the remuneration from the first employment in the Republic which began after July 26, 2022 until the year 2027, by a person who was employed outside the Republic by an employer who is not a resident of the Republic for three consecutive years, immediately before the beginning of his employment in the Republic. The tax exemption is granted for 7 years, from the year following the start of the first employment in the Republic. For the previous exemption that was granted to employments that began within the year 2012 and until July 26, 2022, the tax exemption is calculated at 20% of the remuneration (maximum €8,550 per year) and was valid for 5 years. Individuals who qualified for the exemption before its end date (ie 26 July 2022) will continue to benefit for the relevant five-year period.

(10) 50% of the remuneration from employment exercised in the Republic by a person who was not a resident of the Republic for at least 15 consecutive years, immediately before the start of his first employment in the Republic, provided that the start of the first employment in the Republic takes place from January 1, 2022 onwards and the remuneration from such employment exceeds €55,000.

The exemption is granted for 17 years, from the month of employment in the Republic and may also be granted to the following persons:

• people whose employment started before 1 January 2022, if the start date of the first employment was between 2016-2021, their salary was more than €55,000 per year, or if not, more than €55,000 per year within six months of 26 July 2022.

• existing employees who benefited from the 50% exemption and have continuous employment in Cyprus until the year 2021.

It is noted that individuals who qualified for the previous exemption granted in employment that began before its termination date (i.e. 26 July 2022) will continue to benefit for the relevant ten-year period, unless the individual qualifies for the new exemption of Article 8(23A).

• Memberships in guilds or professional associations – 100%

• Donations to approved charities – 100%

• Expenses for building rents receivable – 20% of rents

• Interest for rental building – 100%

• Expenses for maintenance of listed building – up to €700, €1100 or €1200 for each sq.m. depending on the area of ​​the building.

Contributions that are deductible for the purpose of calculating the taxable income of a natural person:

• Social Insurance Fund

• General Health System (GESY)

• Approved Provident and Pension Funds

• Medical Care Plan

The total amount of the health fund and health insurance
limited to 1,5% of gross income.

• Life insurance premiums

Annual premiums are limited to 7% of the insured amount.

In case of cancellation of a life insurance policy within 6 years from the date of its issue, a percentage of the premiums granted as a discount is taxed, as follows:

− cancellation within 3 years 30%

− cancellation from 4 to 6 years 20%

*The DEDUCTION is limited to 1/5 of the taxable income as calculated before deducting this deduction.