Cyprus Tax Guide

Cyprus

Currency: EURO

Foreign Exchange Control:  Temporary measures from 2013.

Accounting Principles:  IFRS. Accounts audited and filed annually.

Business Entities: Principally, public and private limited liability companies.

Corporate Taxation

Residence: If management and control exercised locally.

Basis: Resident companies subject to tax on worldwide income; non-resident companies only subject to tax on Cyprus-sourced income.

Rate: 12.5% with certain types of income subject to Special Contribution for Defence (SCD) at other rates.

Foreign Tax: Unilateral tax credit granted for tax paid abroad.

Other: Preferential treatment possible for interest, royalties and I.P.

Tax Year: Calendar Year. Electronic filing of return mandatory by 31 March following end of the tax year.

Personal Taxation

Residence: Resident individual subject to tax on worldwide income; non-resident individual only taxed on Cyprus-sourced income (Resident if >183 days in a tax year).

Rate: First €19,500 tax free, with progressive rates above this level up to 35%.

Capital Gains: Gains on sale of shares exempt; 20% on immovable property, and shares in unlisted companies which own Cyprus-based immovable property.

Other: Stamp duty varying rates up to €20,000.

Real property tax:  Annual charge of 0.6% to 1.9% based on 1st January 1980 market value.

Inheritance Tax:  None

Social Security: 6.8% Employees, 12.6% Employers generally.

VAT: Rate is 19%, with registration threshold of €15,600.

Member Firm: KPSA

Email:
Nicos Kastellanis: nkastellanis@kpsa.com.cy
Stelios Saphiris: ssaphiris@kpsa.com.cy