Cyprus Tax Residency
Cyprus Tax Residency & Non-Dom for Individuals
“The 183 Day Rule”
An individual in Cyprus becomes a tax resident of the island for income tax purposes, provided they stay physically for over 183 days in total within the year.
The new law is not binding on individuals who move into Cyprus to become permanent residents or citizens of the Republic of Cyprus. Such individuals usually qualify under the 183 days rule.
“The 60 Day Rule”
Any individual who meets the newly introduced “60 days rule” requirements is considered a tax resident. The new law applies to any person, provided they meet the following criteria from 1 January 2017:
- They stay in Cyprus for over 60 days in a calendar tax year.
- They are not a tax resident of another country.
- They do not reside for up to 183 days in total in another country.
- They have verifiable economic ties with the island, for instance, owning or renting a permanent residence in Cyprus.
- The applicant for the 60-day rule is a worker in Cyprus, runs business activities in Cyprus, or acts as a Director in a Cypriot tax resident company at any point of time in the year being considered.
As stipulated by the 60-day rule, the day of residence is the arrival date at the airport or port in the Republic of Cyprus. Also, the day of departure from the country is recorded as a day of non-residency in Cyprus. Applicants need to stamp their passports during exit and entry from Cyprus Authorities. Applicants who enter or exit via the airports must keep their tickets and boarding passes.
Why should you become a Cyprus Tax Resident?
There are several benefits for a Cyprus Tax Resident, under both the 183-day rule and the 60-day rule. One of these is the Tax Authorities non-domiciled scheme, which exempts applicants in Cyprus from tax on their passive interest income and global dividends.
All profits from the sales of options, debentures, bonds, shares, and other instruments are not taxable in Cyprus. However, specific exceptions apply to the sale of immovable property in Cyprus.
Cyprus Tax Residents who are employed in other countries outside Cyprus and earning over 100,000 Euros get 50% off their income tax for 10 years, provided they were not a tax resident of Cyprus before they became employed in Cyprus.
At DIONYSIOU LEGAL, we are always available to help you assess your Tax Residency status and offer expert advice on how to get the right Tax Residence.