Individuals who are working in Cyprus and Pensioners are liable to pay the Special Contribution Tax in Cyprus in accordance with their monthly emoluments.

TAX RATES FOR THE YEARS 2014 & 2015

Gross Monthly EmolumentsPublic Sector Private Sector 
RateRate
0 - 1,500NilNil
1,501 - 2,5002.5%2.5%
2,500 - 3,5003%3%
Over 3,5003.5%3.5%
 

PRIVATE SECTOR

  • Subject to this tax are Employees, Self-Employed Individuals and Pensioners of the Private Sector
  • The above persons are obliged to pay a minimum tax of €10 in case their monthly emoluments exceed €1,500 in any month (excluding the 13th salary which is calculated as a separate month).
  • In the case of Employees and Pensioners the Tax applies to emoluments received from Cyprus sources and it is payable on a monthly basis.
  • In the case of Employees the above tax is shared (50%) with their employer and the Tax does not apply on retirement gratuities, payments from approved provident funds, remuneration of the crew of qualifying ships and on reimbursements of business expenses.
  • In the case of Self-Employed Individuals the Tax applies to any business carried on in Cyprus and is payable twice a year together with the temporary tax installments.
 

PUBLIC SECTOR

  • Subject to this tax are both Employees and Pensioners of the Public Sector.
  • The minimum tax of €10 does not apply for Public Sector Individuals.
  • The Special Contribution Rate becomes 3%, 3,5% and 4% respectively for highly ranked Employees within their respective scale.
 

TAX TREATMENT

The Special Contribution Tax is considered a Tax Allowable Expense and decreases the Annual Taxable Income of the Individuals.