Cyprus Taxation is one of the lowest taxed countries in the World and the least taxed among the EU members. Due to this, its good infrastructure and favorable double taxation treaties with numerous countries (40), the island has become one of the most reputable offshore centers, with the establishment of over 17,000 foreign companies (named International Business Companies IBC’s).
Company & Corporation Cyprus Taxation
The recent legislation on Cyprus taxation reform has separated the resident companies (i.e., Companies who control and manage well in Cyprus) and the non-resident companies (i.e., Companies whose management is exercised outside Cyprus).
The Corporation Tax in Cyprus is only 12.5%
Double Taxation Agreements
Immovable Property Tax
Remember that you should pay all outstanding immovable property taxes before the conclusion of the transfer and produce the receipt to the Land Registry. The annual immovable property Cyprus taxation is calculated on the property’s market value as of 1st January 1980.
Capital Gain Tax
Capital Gains Tax is levied at the rate of 20% on gains arising from the disposal of immovable property or the disposal of shares of companies, the assets of which consist mainly immovable property.
Cyprus Taxation: Council Tax
Council Taxes are payable to the Council at which your property is listed at the end of each year. The said taxes are due to be paid by you once you get the property’s delivery and not before that.
Council Taxes are of the approximate amount of EUROS 400= per year, depending on which Council your property is listed.
Other Fee & Expenses
Stamp Duty Fees
The buyer pays all Stamp Duty Fees at the rate of 1.50 Euros per thousand of the value up to 170,860 Euros. Over this amount, the Fees are 2.00 Euros per thousand. The documents should be stamped within 30 days after their signing to avoid a fine payment, which could be a substantial amount of money.
The transfer fees regarding Cyprus taxation are calculated as follows:
Property value (Euros) Transfer fees Accumulated Transfer Fee (Euros)
0-50,000 3% 1500
50,000-100,000 5% 4000
100,000- and over 8% —-
Electricity, water, and telephone connections cost approximately 100 Euros each, and the bills are payable monthly or quarterly.
The bills are not high compared to other countries, but they depend on consumption. For off-plan properties, the invoices are payable after completion.
The legal fees are of the approximate percentage of 2% to 2.5% of the all-inclusive purchase price. This includes the legal costs of the approximate rate of 1.25% plus the VAT 15% plus the real expenses of the amount of 0.75%, including stamp duty on contracts and power of attorneys, postage and administration, and 0.5% for a mortgage arrangement fee.
Find out more from Cyprus Taxation Website
Related: Propoerty Sales in Cyprus 2019