Low Taxes Drive Growth in Cyprus

Low Taxes Drive Growth in Cyprus

Low Taxes Drive Growth in Cyprus

In recent years, investors and property buyers have flocked to Cyprus, but it’s not just the bright sunshine and blue sea that has them hooked. It’s the low taxation rate. Cyprus has the European Union’s most favourable tax system for corporate & individuals.

At AME Second Citizenship, we know that the low taxation in Cyprus has limitless benefits for investors, employees and employers. So, here’s the information our high net worth clients seek before they purchase property on the island.

Cyprus Taxation, The Facts

  • At 12.5% corporate tax, Cyprus has the lowest rates in the EU
  • The Cypriot tax regime complies with European Union Laws
  • Corporate tax can be 0% as gains from trading in securities are completely exempt
  • Dividends to shareholders are tax free
  • There is no inheritance or gift tax in Cyprus
  • Profits from the sale of shares, bonds and other titles of companies established anywhere in the world are exempt from tax
  • Cyprus has double tax treaties with over 50 countries
  • Employees enjoy a 30% cap on personal income tax, together with a high tax-free threshold of €20,000
  • Cyprus businesses benefit from free movements of profits derived from operation on non-resident investments
  • Salaries of foreign employees of offshore entities employed outside Cyprus are completely tax exempt
  • High value property purchases on the island can often carry additional perks for non-EU citizens such as a European passport

Property Taxes

When it comes to property purchase and ownership, buyers can also enjoy low taxation rates. This makes Cyprus incredibly appealing not only for first time buyers but also serial investors and high net worth investors. Here’s what taxation on properties look like in Cyprus.

Transfer Fees – A onetime payment for the title deeds of the property in Cyprus, this fee is a percentage of the property’s value.

VAT- Depending on individual circumstances, the property buyer may need to pay VAT on the property purchase price.

Immovable Property Tax – Since 2016/2017 immovable property tax has been removed.

Municipality Taxes– Ongoing bimonthly or quarterly taxes paid to the Municipality to cover refuse collection, lighting, sewerage and other local charges are low in Cyprus. Yearly amounts depend on the property size and location but are a fraction of the cost paid in other European countries.

 

Low taxes are driving growth in Cyprus by encouraging property investment, entrepreneurial start-ups and offshore employment. Indeed, there are perks for everyone who resides on the island or invests in its infrastructure. To learn more about the benefits of Cyprus investment and how to apply for the Cyprus Investment Programme, please speak to our knowledgeable team.