Cyprus Property Taxes, Fees and Duties

Real Estate Transfer Fees

Purchasers will be liable to pay transfer fees for the property when it is registered in their name at the District Land Registry Office. The fees are charged on the market value at the date of the purchase as follows:

However, should the property be in joint names then transfer fee will be reduced.

Immovable Property Tax & Services Tax

The annual immovable property ownership tax imposed by the government is approximately €103-205 per year depending on the value of the property. The municipal tax is at the rate of about €34 - 68 per year. Other authorities may also impose a sewerage tax of €51 -103, depending on the value of the property.
 

Capital Gains Tax

Capital Gains Tax is payable at the rate of 20% on gains arising from the sale of a property, with the first €19.500 being exempt, for each person. The gains are the difference between the sales proceeds and the original cost of the property. However, the Vendor is entitled to a further indexation allowance of capital expenditure and inflation on the property during the period of ownership which can be deducted from the taxable gain. Where the property has been used as a principal place of residence for at least 5 years, gains are exempt of up to €85.430.
 

Stamp Duty

The purchaser is liable for the payment of stamp duty at the rate of 0.15% per thousand up to the value of €170.860 per year and thereafter at the rate of 0.20% per thousand. This should be paid within 30 days of signing the contract.For example:

If the property purchase price is €256.290,00, then the stamp duty paid is as follows:

Local Authority Taxes & Rates

Local authority rates and taxes vary according to each Municipality. Property owners could expect to pay approximately €85-256 per annum depending on the size of the property. This tax accommodates refuse collection, street lighting, sewerage, etc. The basic utilities of electricity, water and telephone are payable individually in accordance with the consumption and based on a meter reading.
 

V.A.T.

Since 1/5/2004 a statute in respect of V.A.T. statute properties was introduced. In addition to other amendments, this statute introduced V.A.T. on the rate of 15%. Properties with building permits before 1/5/2004 are exempt of V.A.T.
 

Tax Advantage

Cyprus is unique when it comes to the taxation aspects of living on the island. The following income tax rates apply to individuals:

Retirees who become residents in Cyprus are taxed on their pensions from abroad at the rate of 5% per annum while an exception for the first €3.417 is granted. Additionally, Cyprus has Double Taxation treaties with many European and other countries, safe-guarding its residents from paying tax in both countries. This gives the option to the citizens of those countries to take advantage of the very low rate in Cyprus.
 

Double Taxation Agreements

Cyprus has double-taxation agreements with Austria, Belarus, Belgium, Bulgaria, Canada, China, the Czech Republic, Hungary, India, Ireland Italy, Kuwait, Kyrgyzstan, Malta, Mauritius, Norway, Poland, Romania, Russia, Singapore, Slovakia, South Africa, Sweden, Syria, Tajikistan, United Kingdom, United States, Yugoslavia (former). The main purpose of these treaties is the avoidance of double taxation of income earned in any of the above countries. A credit is usually allowed against the tax levied by the country of the tax payer’s residence for taxes levied in the other country. Treaties are under negotiation with another 23 countries.
 

Duty Free Privileges

EU Nationals who become permanent residents in Cyprus and have owned a motor vehicle in their original country of residence for at least six months, can bring their car to Cyprus exempt of any import tax. Furniture can be imported free of any taxes by Europeans or Non-Europeans who become permanent residents provided that they are for personal use and are not brand new.