Cyprus Non-Domiciled Status Program 2024 – Are You Eligible?

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Cyprus offers numerous tax advantages to its citizens, with provisions extending benefits to foreigners and expats looking to make Cyprus their home. The Cyprus Non-Domiciled Status Program is another promising initiative that allows residents to benefit from financial security and economic wellbeing.

Individuals can benefit from this program if they are tax residents of Cyprus and have not been tax-paying citizens for 20 consecutive years before July 2015, when this law was first introduced.

Keep reading to learn about the Cyprus Non-Domiciled Status Program in detail.

cyprus non-domiciled

Who can benefit from Cyprus Non-Dom Tax the most?

The Cyprus government wanted to attract high-income individuals, entrepreneurs, and businesspeople to relocate their businesses, investments, and themselves to Cyprus in order to boost the local economy by introducing enhanced tax benefits for non-domiciled residents. This was obviously a success because the nation currently has a vibrant economy that provides a very good standard of life to both native Cypriots and foreigners who contribute to the local economy while also being able to maximize their own financial affairs. The Cyprus Non-Domiciled Status Program is a great choice for anyone who wishes to take advantage of it.

Additionally, this benefit, which is highly valued by investors, is valued by those who wish to invest in the nation and take advantage of the possibility of paying cheap taxes. Every investment increases in value over time as a result of the ease and benefits the program offers to participants, which draws their attention. Who would want to pass up such a lucrative investment opportunity?

Who is Eligible for Cyprus Non-Dom?

Individuals are classified as tax-paying residents of Cyprus if they have been physically present in the country for over 183 days of a calendar year. The 60-day rule also applies if the individual has maintained a permanent primary residence, owned or rented, and has not lived in any other country for longer than 183 days. Individuals can either reside in a property they own or one they have rented in any location across Cyprus.

The Cyprus Non-Domiciled Tax Status is granted to individuals who have not been tax residents of Cyprus for the past two decades. This Tax Status is validated by the Cyprus taxation authorities annually, and applications must submit relevant forms to be considered for this program. Calculate your time in Cyprus to ensure your eligibility before submitting your application.

Find out more about Cyprus Non-Domiciled Program

Tax Benefits & Exemptions

hefty tax deductions. The most appealing benefit of this tax status program is the exemption individuals enjoy from capital gains tax on the income they earn from interest and dividends.

Cyprus yields enormous attraction in the international market for its tax exemptions, hailed as the most promising low tax jurisdiction across the European Union. Foreign investors and high-profile entrepreneurs choose Cyprus as their primary tax residence to enjoy the exemptions provided under the Non-Domiciled Tax Status. Companies and individuals with high net worth choose Cyprus as the base of their corporate operations, enjoying easy access to European markets and superior life quality to relocate their families.

Let’s take a closer look at the benefits:

  • The dividend income of the individual, earned through local and foreign investments, will not be subject to capital gains tax.
  • The individual’s interest income will not be subject to tax earned through local and foreign investments. Moreover, the interest income will not be subject to income tax, and residents filing under the Non-Domiciled Tax Status will pay zero interest income tax.
  • Individuals earning a rental income from properties situated in Cyprus or elsewhere will only be subject to normalized income tax rates of:
    • Up to €19,500 → 0%
    • €19,500 to €28,000 → 20%
    • €28,000 to €36,300 → 25%
    • €36,300 to €60,000 → 30%
    • Over €60,000 → 35%

Read More: Cyprus Tax System: A Detailed Guide

Who Can Apply for the Cyprus Non-Domiciled Tax Residency?

The requirements and procedures are relatively flexible as the Cypriot government wants to attract investors, entrepreneurs, and families looking to secure tax exemptions on their wealth and capital gains. Any Cypriot national can apply for this program under the revised 60-day rule or 183-day rule. The tax exemptions are valid for the individual’s worldwide income and wealth, as long as Cyprus remains their country of permanent residence.

This program is a commendable effort from the government to simplify and enhance the country’s taxation legislation and make the Cypriot economy a highly facilitative and compliant jurisdiction for high-profile investors and foreign entrepreneurs to thrive.

Key Changes and Updates in the 2024 Program

The Cyprus Non-Domiciled Status Program has undergone significant updates and refinements in 2023, aiming to attract a broader pool of eligible applicants and offer enhanced incentives. One of the primary changes involves the expansion of the qualifying criteria, making it more accessible for individuals seeking tax residency in Cyprus. The program now provides extended tax exemptions and benefits, including a revised framework for foreign-sourced income, capital gains, and inheritance.

Additionally, the updated program streamlines the application process, offering a clearer pathway for prospective applicants while ensuring compliance with regulatory requirements. These alterations signify a proactive approach by the Cypriot government to adapt to global economic shifts, reinforcing the country’s appeal as an attractive destination for individuals seeking favorable tax structures and residency options.

Frequently Asked Questions: Cyprus Non-Domiciled Status Program

Individuals who have not been tax residents of Cyprus for the past 17 out of 20 years prior to the tax year of application are eligible to apply for Cyprus Non-Domiciled Status.

Some of the key benefits of obtaining Cyprus Non-Domiciled Status include:

– Exemption from taxation on worldwide dividends and interest income for a period of 17 years.
– Exemption from taxation on worldwide capital gains for a period of 17 years.
– No inheritance tax for assets located outside of Cyprus.
– No withholding taxes on dividends, interest, and royalties received from abroad. 

In order to maintain Cyprus Non-Domiciled Status, individuals must abide by certain conditions, including:

– Spend less than 183 days in Cyprus in any tax year.
– Not be tax resident in any other country.
– Register with the Cyprus Tax Department as a non-domiciled individual.

To apply for Cyprus Non-Domiciled Status, individuals must submit a formal application to the Cyprus Tax Department, along with supporting documents that demonstrate their eligibility for the program.

Yes, there are certain fees associated with the Cyprus Non-Domiciled Status Program, including an annual fee of €5,000 for individuals who have received the status.

Conclusion

All investors, entrepreneurs, and property owners looking to secure tax exemptions are encouraged to apply to elevate their financial health and achieve their wealth-generation ambitions. This tax exemption program greatly transforms Cyprus into an attractive economy and an investor-friendly tax jurisdiction.

For further information on its economic advantages and eligibility criteria, connect with our team for a detailed consultation session at info@sunshadowinvest.com or call us at +357 24 816246.

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