Tax Residency in Cyprus

A natural person can become a tax resident of Cyprus and transfer their tax residence there to enjoy the tax advantages offered by Cyprus:

1. Provided they remain in Cyprus for more than 183 days in a tax year.
2. Provided they are considered a “60-day” tax resident of Cyprus. To be considered a “60-day” tax resident of Cyprus, they must not be considered a tax resident in any other state and:

1. They must not reside in any other single country for a period exceeding 183 days and are not considered a tax resident by any other state.
2. They must remain in Cyprus for 60 days in the relevant tax year.
3. They must conduct any business/activity in Cyprus and/or be employed in Cyprus and/or hold a position (e.g., director) in a person who is a tax resident of Cyprus at any time during the relevant tax year.
4. The natural person must maintain a permanent residence in Cyprus during the tax year, which is either owned or rented.

By changing your tax residency to Cyprus, you can now enjoy a range of advantages as a natural person. In more detail:

• Tax exemption on dividends and interest.
• Tax exemption on profits arising from the sale of shares or other securities, provided that these assets do not include immovable property in Cyprus.
• 50% tax exemption on the income of an employee who was not considered a tax resident of Cyprus before their employment in Cyprus. This exemption is valid for 17 years if the income exceeds €55,000 annually.
• If the income is below €100,000, the tax exemption is 20% with a maximum amount of €8,550 per year.
• 100% tax exemption for individuals whose income arises from services provided outside of Cyprus for an employer who is not a tax resident of Cyprus.
• A 5% tax on income derived from pensions or provident funds from employment abroad.
• 100% tax exemption on amounts received from life or health insurance policies.
• No taxation on amounts arising from the sale of real estate abroad.
• No inheritance or wealth tax is applied.