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Taxes in Cyprus

In a country like Cyprus, taxation is built on the principle of loyal attitude to both legal entities and to individuals. However, loyalty to the state applies only to those who accept and promptly comply with the conditions for the preparation and filing tax returns.

In cases of delinquency, with the defaulter may be charged penalties, Cyprus their size is regulated depending on the term of the debt and is usually 10% APR for the repayment of the debt, plus an additional 5% over the past full months of delay.

The main taxes for businesses include:

    • Corporate income tax resident company of Cyprus - its rate is 12,5%.
    • Property tax - the tax rate is determined by the value of the property. For example, if the object is worth to 170 680 euro, such properties are not taxed in the other cases the rate may be 2,5%, 3,5% and 4%.
    • Value added tax - in most cases, its rate is 15%, and it is paid only if the volume of sales of goods and services in Cyprus is more than 15 600 euro. However, there are exceptions, which provide for a reduction in the tax rate to 8% for companies representing the restaurant business, up to 5% for companies that sell pet food, pharmaceutical products, agricultural products, handicapped items, newspapers, books and some others. VAT is not paid at all by firms that provide postal, financial, insurance and educational services.
    • Taxes in Cyprus paid on capital gains (for example, after the sale of real estate) - rate is 20%.
    • Tax on share capital - calculated at 0,6%.
    • Defense tax - the rate depends on the type of income, which belongs to the income and may be 2,25%, 10% or 15%.


      Individuals-residents of Cyprus must pay a profit tax, which is established for all income received by a resident both inside and outside the country. From the payment of this tax residents are exempted, whose total annual income is less than 19 500 euro. In other cases, the tax rate, depending on the amount of revenue, can be 20%, 25% or 30%. Separately pay taxes on a foreign pension, the size of the rate in this case is an additional 5%. The taxable income of resident individuals does not include dividends, medical insurance payments, death benefits, and certain other social payments.

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