Personal Income Tax in Cyprus
Individuals who reside in Cyprus above 183 days in a calendar year, are considered Cyprus Tax Residents in the relevant year and are liable to be taxed on their worldwide accrued income in Cyprus. Overseas Taxes that were paid by Cyprus Tax Residents can be credited against their personal income tax liability.
Individuals who are not Cyprus Tax Residents are taxed in Cyprus on the accrued income that was generated only from Cyprus sources.
The Personal Income Tax Rates for 2014 are shown below:
|Taxable Income||Tax Rate||Accumulated Tax|
|0 - 19,500||Nil||Nil|
|19,501 - 28,000||20||1,700|
|28,001 - 36,300||25||3,775|
|36,301 - 60,000||30||10,885|
|over 60,000||35||to be calculated|
Foreign Pension is taxed separately at the tax rate of 5% and an annual exemption of €3,420 is given.
- Interest Received.
- Dividends Received or Proposed.
- Profits from an overseas permanent establishment are exempt under certain conditions.
- Lump sums received for compensation of death or injuries.
- Capital sums payable to individuals from approved funds.
- Profits from sale of financial instruments such as listed shares, bonds, debentures.
- Salaries for services rendered outside Cyprus to a non-Cyprus Resident Employer or to a foreign permanent establishment of a Cyprus Resident Employer.
- Persons who became Cyprus Tax Residents after 1 January 2012 because of their employment in Cyprus (found job within the first 6 months from their arrival) and their annual remuneration exceeds €100,000 are eligible to 50% exemption on their income up to the calendar year 2016.
- Persons who became Cyprus Tax Residents because of their employment in Cyprus (found job within the first 6 months from their arrival) are eligible to 20% exemption on their income up to a maximum amount of €8,550 annually, for a period of 3 years effective from the 1st of January following the year the employment was commenced.
- Payment to trade unions and professional bodies.
- 20% of Rental Income.
- Donations to approved Charities.
- The Expenses paid for the maintenance of preserved building up to €1,200, €1,100 or €700 per square meter depending on the size of the building.
- The total sum of Social Insurance Contributions, Provident Fund , Medical Fund, Pension Fund and Life Insurance payments is restricted to 1/6 of the chargeable income.
- The Special Contribution Tax paid.