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Individuals who are Cyprus tax residents, that is, individuals who, in the year of assessment, always a calendar year, stay in the Republic of Cyprus for a period or periods exceeding in aggregate 183 days, are subject to tax on their worldwide income, whether remitted to Cyprus or not.
Individuals who are non-Cyprus tax residents, that is, individuals who, in the year of assessment, always a calendar year, do not stay in the Republic of Cyprus for a period or periods exceeding in aggregate 183 days, are subject to tax only on their Cyprus-source income. |
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INCOME TAX RATES
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Income tax rates for 2004 and thereafter |
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Income tax rates for foreign pensions
Foreign pensions which exceed the amount of CYŁ2,000 are taxable at the rate of 5%, irrespective of remittance the recipient of such pension may elect, for each year of assessment, to be taxed at the normal rates.
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Notes
1. Provided the 40% limit does not exceed 25% of the gross income of the depositor. 2. The employer must either be a non-Cyprus tax resident or a Cyprus tax resident with a permanent establishment abroad. For the exemption to apply, the service abroad must be for a period or periods of more than 90 days in aggregate, in anyone year of assessment 3. Excludes interest arising from or closely related to the ordinary carrying on of a business. 4. The exemption applies for a period of three years, commencing on 1 January following the year of employment. |
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EXEMPT INCOME |
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Income tax rates for 2003 |
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General Information on taxation in Cyprus is supplied on this page. |
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Taxable Income |
Tax Rate |
Taxable Income |
Cumulative Tax payable |
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CYŁ |
% |
CYŁ |
CYŁ |
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First |
9,000 |
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9,000 |
- |
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Next |
3,000 |
20 |
12,000 |
600 |
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Next |
3,000 |
25 |
15,000 |
1,350 |
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Over |
15,000 |
30 |
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Taxable Income |
Tax Rate |
Taxable Income |
Cumulative Tax payable |
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CYŁ |
% |
CYŁ |
CYŁ |
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First |
10,000 |
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10,000 |
- |
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Next |
5,000 |
20 |
1,000 |
1,000 |
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Next |
5,000 |
25 |
1,250 |
2,250 |
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Over |
20,000 |
30 |
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Type of income |
Limit |
Note |
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Deposits made with the Housing Finance Corporation (Special savings scheme) |
40% of the amount deposited |
1 |
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Widows pensions under an approved scheme |
100% |
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Profits on disposal of shares |
100% |
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Remuneration from salaried services rendered outside Cyprus |
100% of emoluments |
2 |
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Dividend income |
100% |
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Interest income |
100% |
3 |
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Remuneration of individuals who, before commencing employment in Cyprus, were not Cyprus tax residents |
Emoluments up to 20% Of maximum of CYŁ5,000 |
4 |
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Lump sum on retirement, commutation of pension, or compensation for death or personal injury |
100% |
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Capital sums received in respect of approved life insurance policies or provident, pension and other funds |
100% |
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ALLOWABLE DEDUCTIONS
Notes 1. Deduction will be abolished on 1 January 2004. 2. In case of a loss, to the extent of the donation, the loss is not carried forward. 3. Depending on the covered area of the building, as follows:
PERSONAL ALLOWANCES
Notes 1. Provided that life insurance premiums do not exceed 7% of the capital sum assured on death. In case of early cancellation of a life insurance policy, a percentage of the premiums which were previously allowed as a deduction is taxable. 2. The total deduction for all above allowances is restricted to 1/6 of an individual's chargeable income before deducting these allowances. |
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Description |
Limit |
Note |
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Interest on loans for main residence |
Up to CYŁ500 |
1 |
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Annual subscriptions to trade unions and professional associations |
100% |
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Donations to approved charitable institutions |
100% |
2 |
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Rental income if the rented property is a building |
20% of gross rental income |
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Interest on loans to acquire assets used in business 100% Expenditure incurred for the purpose of maintaining a preserved building |
Up to CYŁ350 per square meter |
3 |
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Square metres |
CYŁ per square metre |
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Up to 100 |
Up to 350 |
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101-1000 |
Up to 300 |
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Over 1000 |
Up to 200 |