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Cyprus Tax Guide
EuropeLast verified October 2026Worldwide system
- Top income tax
- 35%
- Capital gains
- 20%
- Corporate
- 15%
- VAT / GST
- 19%
- Residency test
- 183 days
Progressive 0-35%; first €22,000 tax-free (2026 reform, up from €19,500)
In short
- Limassol offers English-friendly EU residency, a sunny climate and a non-dom regime that makes dividends from a holding company tax-efficient.
- Non-Dom Regime: No Special Defence Contribution on dividends and interest for non-doms (17 years).
- Watch out: Limassol rents rose sharply after 2022, summers are very hot, and internet is slower than most EU capitals.
Verified October 2026 · 4 sources
Recent changes
- 2026-10-31 addedPersonal tax-free band was missing from the 2026 reform coverage: added the raised threshold (€22,000, up from €19,500) and the full progressive bands (0/20/25/30/35%).
Best for
- Special regime available
Non-Dom Regime — 17-year exemption from Special Defence Contribution (SDC) on foreign dividends and interest for qual…
Personal Income Tax
Residency, rates, foreign income, capital gains, wealth and inheritance, special regimes+
Personal Income Tax
Residency, rates, foreign income, capital gains, wealth and inheritance, special regimesTax Residency
Income Tax Rates
Foreign Income Treatment
Investment Income
20% on Cyprus real estate; gains on securities exempt
Wealth & Inheritance
Special Regimes
Practical Notes
2026 reform raised the personal tax-free band to €22,000 (bands: 0% to €22,000, 20% to €32,000, 25% to €42,000, 30% to €72,000, 35% above), reduced SDC on dividends from 17% to 5% (for profits earned from 1 Jan 2026), abolished Deemed Dividend Distribution on 2026+ profits, and extended tax loss carry-forward from 5 to 7 years. Non-dom regime remains the headline draw. English widely spoken; EU member.
Business & Corporate Tax
Corporate rate, withholding, VAT, substance, Pillar Two and treaties+
Business & Corporate Tax
Corporate rate, withholding, VAT, substance, Pillar Two and treatiesCorporate Income Tax
Withholding Taxes
VAT / GST
Compliance & Substance
Notable Regimes
- IP Box regime
- Notional Interest Deduction
- Tonnage tax (shipping)
OECD Pillar Two (15% global minimum tax)
Implemented with delay; retroactive application to FYs starting on or after 31 Dec 2023. Separately, standard CIT raised from 12.5% to 15% from 1 Jan 2026 under broader 2026 reform.
See full implementation trackerTax Treaty Network
US-Cyprus treaty in force. No US totalization. Cyprus non-dom regime coordinates with treaty residency — useful for US-citizen non-doms.
See full treaty matrixBeyond tax
Living in Cyprus
Limassol offers English-friendly EU residency, a sunny climate and a non-dom regime that makes dividends from a holding company tax-efficient.
- Expat hub
- Limassol
- Monthly budget
- ~$3,200
- Climate
- Mediterranean, 20°C
- Time zone
- UTC+2
- Tax80 → 95
- Cost of living$$$
- Safety78
- Healthcare76
- English85
- Internet85 Mbps
- Warm climate75
- Residency access60
- Scores 0-100, higher is better. Editorial composite ratings; see method.
Newcomer tax regime
Non-Dom Regime: 0%
No Special Defence Contribution on dividends and interest for non-doms. 17 years. Who qualifies: Cyprus tax residents who are not Cyprus domiciled.
Ways to get residency
- Digital Nomad visa€3,500/month net income from abroad, capped number of permits
- Permanent residence (fast-track)€300,000+ in new property plus secured annual income
- Category F / visitor permitProof of sufficient secured annual income; no right to work
Watch out: Limassol rents rose sharply after 2022, summers are very hot, and internet is slower than most EU capitals.
See how Cyprus ranks for remote workers, retirees and familiesData Sources
Last verified: October 2026. Always check official sources before making a decision.
FAQ
What is the personal income tax rate in Cyprus?
+
Cyprus has a top personal income tax rate of 35%. The tax structure is: Progressive 0-35%; first €22,000 tax-free (2026 reform, up from €19,500). See the detailed breakdown above and verify with official sources.
Do I need to pay tax on foreign income in Cyprus?
+
Cyprus uses a worldwide system for foreign income. Non-dom regime exempts foreign dividends and interest from SDC for 17 years from first year of residency
What are the residency requirements for Cyprus?
+
Tax residency in Cyprus generally requires 183 days of physical presence. 183 days required; 60-day rule available for individuals meeting alternative tests. Always verify current rules with official sources.
Is there a wealth tax in Cyprus?
+
No, Cyprus does not have a wealth tax. No wealth tax
What is the corporate tax rate in Cyprus?
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The corporate tax rate in Cyprus is 15%. 15% from 1 Jan 2026 (up from 12.5% — 2026 tax reform, aligned with OECD global minimum). Tax losses now carry forward 7 years.
US citizen moving to Cyprus? Read this first.
Cyprus's top personal rate of 35% means the Foreign Tax Credit (FTC) usually wins over FEIE for US citizens.
- •FTC (Form 1116) credits Cyprus tax against US tax dollar-for-dollar. Because Cyprus tax exceeds US tax on the same income, you typically owe zero US tax and accumulate carryforward credits (10-year carry).
- •Self-employment tax is owed in full to the US — no totalization agreement with Cyprus.
- •For earned income near the FEIE cap (~$130k), FEIE is sometimes simpler administratively. Above the cap, FTC strategy almost always wins given Cyprus's rates.
- •Cyprus residency days threshold: 183. Treaty tie-breaker rules (where applicable) help with double-tax avoidance.
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