Property Taxation in Cyprus

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Immovable Property Tax

Immovable Property Tax is imposed on the market value as at 1st January 1980 and applies to immovable property located in Cyprus owned by the taxpayer on 1st January of each year. This tax is payable on 30th September each year. A discount of 10% of the tax due is available if the tax is paid by 31 August each year. Physical and legal persons are both liable to Immovable Property Tax.

The Inland Revenue Office will calculate the amount of tax, the property owner must pay. Furthermore, if the property is registered in two names, then the tax payment will be calculated based on the half of the 1st January 1980 value.

Value of Property on 01st January 1980 (€)

Rate (%)

Accumulated Tax (€)

First €40.000*

6

€240

From €40.001 – to €120.000

8

€880

From €120.001 – to €170.000

9

€1.330

From €170.001 – to €300.000

11

€2.760

From €300.001 – to €500.000

13

€5.360

From €500.001 – to €800.000

15

€9.860

From €800.001 – to €3.000.000

17

€47.260

Over €3.000.000

19

 

 * Property Owners whose property has a total value of €12.500 or less (using values of 1st January 1980) are exempt from Immovable Property Tax.


The following are not subject to Immovable Property Tax:

  • Public cemeteries.  
  • Churches and other religious buildings (partly exempt).
  • Public hospitals.  
  • Schools.
  • Immovable property owned by the Republic.
  • Foreign embassies and consulates.
  • Common use and public places.
  • Property under Turkish occupation.
  • Buildings under a Preservation Order.
  • Buildings of charitable organisations.
  • Agricultural land used in farming or stock breeding, by farmer or stock breeder residing in the area.

 Stamp duty

All Sale Contracts must be stamped within 30 days of the date of signing a sales contract otherwise a penalty is charged and added to the cost of the stamps. The purchaser is advised to deposit the contract in order to exercise the defence of Specific performance against the developer/seller and benefit from the property tax exemptions. The purchaser has the right to deposit the sales contract within 6 months. However, the purchaser must act and stamp it within 30 days as mentioned above to avoid extra charges. The contracts are stamped in the Tax Office. The stamp duty fees are as follows:

  • Up to 170.860 a fee of 1.5‰ (€2.57 for every €1.000 up to €170.860).
  • Over 170.861 a fee of 2.0‰ (€3.42 for every €1.000 for over €170.861).
  • First €5.000 are exempt of a stamp duty fee.

Transfer Fees

The fees charged by the Department of Land and Surveys to the acquirer for transfers of Immovable property are as follows:

Market Value (€)

Rate (%)

Fee (€)

Accumulated Tax (€)

First 85.430

3

2.563

2.563

From 85.431 – to 170.860

5

4.271

4.271

Over 170.861

8

 

 


The director of the Land Registry Office may dispute the declared value and adopt a Market Value of the property. The adopted valuation date is the date of purchase provided the sales contract is deposited at the Land Registry Office. If not, then the actual transfer date will be adopted as the valuation date, unless proof of the purchase date can be provided.

In case, the property will be registered in joint names, for example (a couple) or two individuals, then the purchase value is split into two parts which results in reduced transfer fees.

The tax table below shows the difference:

Market Value (€)

Rate (%)

Fee (€)

Joint Names

Rate (%)

Accumulated Tax (€)

First 85.430

3

2.563

Individual 1 (85.430)

3

2.550

From 85.431 – to 170.860

5

4.271

Individual 2 (85.430)

3

2.550

   

6.834

   

5.100

Over 170.861

8

Up to €170.860 euro the difference on transfer fees is €1.734

Two purchasers buying one property will pay less in transfer fees as the first €85,000 per person is 3% and the second €85,000 per person is 3% and the second €85,000 per person is 5%.

Subject to Conditions

  • The above transfer fees do not apply if the transaction is subject to VAT.
  • The above transfer fees are reduced by 50%, for any immovable property in case where the transfer takes place by today’s date irrespective of the date of the signing of the contract or its submission to the Land Registry Office, or where the contract was signed and submitted to the Land Registry between the period 2nd of December 2011 until today irrespective of the transfer date.

In case of free transfers of property, the transfer fees are calculated on the value of the property as follows:

  • From parents to children – Nil
  • Between spouses – 0.1%
  • Between third degree relatives – 0.1%
  • To trustees €50

Mortgage registration fees are 1% of the current market value

In the case of companies’ reorganisations, transfers of immovable property are not subject to transfer fees or mortgage registration fees.


Capital Gains Tax

Capital Gains Tax is imposed (when the disposal is not subject to income tax) at the rate of 20% on gains from the disposal of immovable property situated in Cyprus including gains from the disposal of shares in companies which directly own such immovable property. 

  • When you sell a property in Cyprus, even though it may be your main residence, you are liable to pay Capital Gains Tax is charged on its disposal.
  • Any Capital Gain is liable to be taxed at the rate of 20%. Subject to certain conditions, individuals may claim the following deductions:
  • Up to €85,430 if the disposal relates to a private residence.
  • Up to €25,629 if the disposal is made by a farmer and it relates to agricultural land.
  • Up to €17,086 on any other disposal.
  • These deductions are granted once in the lifetime of the individual, until fully exhausted and if an individual claims a combination of them, the maximum deduction granted cannot exceed €85,430.

 Capital gains tax - exemptions

Under the law, certain disposals are not subject to Capital Gains Tax:

  • Transfers arising on death.
  • Gifts made from parent to child or between spouses or between up to third degree relatives. (A third degree relative is one with whom an individual shares about one-eighth (12.5%) of their genes. Third-degree relatives include your great-grandparents, great-aunts, great-uncles, and first cousins).
  • Gifts to a company where the company shareholders are members of the donor’s family and the shareholders continue to be members of the family for five years after the date of the transfer.
  • Gifts by a family company to its shareholders provided such property was originally donated to the company. The property must be kept by the recipient for at least three years. For gifts that were made by the company to its shareholders that took place before 28 May 1999, the exemption applies irrespective of how the immovable property was originally acquired by the company.
  • Gifts to charities and the Government.
  • Transfers as a result of reorganisations.
  • Exchange or disposal of immovable property under the Agricultural Land (Consolidation) Laws.
  • Expropriations (for example, if the property is com