Tax rates

Corporate rate – 12.5%

All companies that are tax resident in Cyprus are taxed on their world wide income, accrued or derived from sources in Cyprus or abroad. Companies that are non Cyprus tax residents are only taxed on income accrued or derived from Cyprus.

Annual levy

An annual levy of €350 must be paid by every company registered with the department of the Registrar of Companies and Official Receiver. When a Cypriot company belongs to a group of Cypriot companies the levy is capped at €20.000 for the entire group irrespective of the number of entities within the group.

VAT – 18%

Value added tax is charged on the provision of goods and services in Cyprus.

Taxation of employees

An individual is taxed if he is a resident of Cyprus. An individual is considered resident if he spends in Cyprus more than 183 days per fiscal year. All Cyprus residents are taxed in Cyprus on their worldwide income. The Income tax rates range from 0% for chargeable incomes up to Euros 19.500 p.a. up to 35% for chargeable incomes exceeding Euros 60.000 p.a. Interest income, dividends and profits from the sale of securities are exempt from income tax.

Special Defence Contribution

  • On dividends – 20%
  • On interest – 30%

This tax is imposed on income earned by Cyprus tax residents.

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