The Cyprus Tax Guide 2026
Ten pages: the reform in one table, the non-dom regime, the domicile test people get wrong, worked numbers and the honest country comparison. Free, instantly.
The 2026 reform quietly rewrote the arithmetic of a Cyprus purchase. Stamp duty is gone, the capital gains exemptions nearly doubled, and the 5% VAT band still has limits that catch people out. Here is the whole bill, before and after you sign.
Almost every confused conversation about Cyprus purchase costs comes from mixing these two up. They are alternatives, not additions.
Buy a new build from a developer and the sale carries VAT. If it is sold before completion, the staged payments carry their own risks, set out on buying off-plan. Because VAT has been paid, the Land Registry does not also charge transfer fees. Buy a resale of a home that has already been lived in and there is no VAT, so the transfer fees apply instead.
What decides which of the two you pay changed on 1 September 2026. The old test was time based: VAT applied where the building was sold within five years of completion and had not been used by an unconnected person for at least 24 continuous months. Decrees amending Schedules 5 and 8 of the VAT Law replaced that with a use based test. VAT now applies to any supply made before first occupation, which the decrees define as systematic use of the building for at least 18 months after its completion or delivery. The practical consequence is that a finished unit nobody has ever lived in stays inside VAT indefinitely, however old it is and whoever is selling it, so a second-hand asking price on a never occupied flat is not automatically a VAT free price.
Until the end of 2025 there was a third line on every purchase: stamp duty on the contract. The Stamp Duties Law was repealed with effect from 1 January 2026, so contracts executed since then attract none. On a €500,000 purchase that is roughly €830 that simply no longer exists.
What the legislation does not cover is professional fees. Lawyers, surveyors and estate agents quote their own rates, so treat any figure you read for those as a market estimate rather than a published one.
Statutory costs only, so every number here traces to legislation rather than to a quote. Move the price, switch the property type, and watch which regime takes over.
Covers VAT, Land Registry transfer fees and stamp duty for 2026. Excludes legal fees, agency commission, survey and mortgage costs, which are quoted rather than legislated. Illustrative: confirm the VAT position with your lawyer before you reserve, because the outer limits are where cases fall over.
The reduced rate is generous. The conditions attached to it are strict, and they are not proportionate: miss one and you do not get a smaller discount, you get none.
The standard rate on a new build is 19%. An individual buying a new home as their primary and permanent residence can instead pay 5% on the first 130 square metres of covered area and the first €350,000 of price, with 19% applying above those points.
Then come the outer limits. If the covered area exceeds 190 square metres, or the total value exceeds €475,000, the reduced band does not simply stop at the threshold. It falls away completely and 19% applies to the entire purchase. The step between a property just inside the cap and one just outside it is worth tens of thousands of euros, which is exactly why this is a question for your lawyer before you reserve rather than after.
Two further conditions catch people. The buyer must be a natural person, so a purchase through a company cannot use the reduced rate at all, and it is one property per person or married couple. The home must also stay your primary residence for ten years: leave earlier and a proportion of the benefit is clawed back.
None of this applies to a home that has already been lived in. Once first occupation has been achieved the sale sits outside VAT, which moves you into the transfer fee regime below.
| Situation | VAT charged |
|---|---|
| New build, qualifying primary residence, within all limits | 5% to €350,000, then 19% |
| New build, second home or investment | 19% throughout |
| New build bought through a company | 19% throughout |
| New build over 190 sqm or over €475,000 | 19% throughout |
| Finished unit never occupied, whoever is selling | Still within VAT |
| Resale of a home already lived in, past first occupation | None, transfer fees apply |
Summary of the position as at September 2026, reflecting the decrees on first occupation that took effect on 1 September. The measurement of covered area, and what counts toward it, is itself a technical question on some developments: get it confirmed in writing.
Charged by the Land Registry when title moves into your name, on a banded scale.
| Portion of the price | Headline rate | Effective rate after the 50% reduction |
|---|---|---|
| First €85,000 | 3% | 1.5% |
| €85,001 to €170,000 | 5% | 2.5% |
| Above €170,000 | 8% | 4% |
| Any property where VAT was lawfully charged and paid | Exempt | €0 |
The 50% reduction has applied since 2012 and has been carried forward every year since. It is a long-standing relief rather than a permanent feature of the law, so it is worth confirming it is still in force at the point you complete.
Buying in joint names splits the price across two sets of bands, so more of the value falls into the cheaper 1.5% and 2.5% tiers. On a €340,000 resale the difference between one buyer and two is real money, and it costs nothing to arrange at the outset. It is also almost impossible to fix afterwards, because the fee is assessed when title transfers, not when you decide you would rather have done it differently.
Under the Immovable Property Acquisition (Aliens) Law, Cap 109, a third-country national needs permission to acquire immovable property. The Council of Ministers' authority to grant it has been devolved to District Officers, so the application goes to the District Office covering the property.
One property for personal use: a house, an apartment, or a plot of land up to 4,014 square metres. Processing typically runs two to six months. Your lawyer files it alongside the purchase rather than before it.
Nothing stops you exchanging contracts and moving in while the permit is pending. Deposit the contract at the Land Registry to protect your position, and completion of title simply waits for the permit to arrive. British buyers have followed this route since Brexit.
Not law yet, but coming. Parliament is examining bills that would tighten purchases by third-country nationals. The version debated in the spring proposed capping them at two plots of about 1,100 square metres in total, and ruling out forest and agricultural land and property near the ceasefire line, ports, airports and military sites. As at 3 September 2026 none of it had passed: four separate bills are on the table, the government has said it will fold them into an updated law, and the House interior committee takes up purchases through companies in October. Until a law is passed and published, the Cap 109 rules above are the ones that apply, and we will update this page the day that changes.
Depositing the sale contract at the Land Registry is the single most important protective step in a Cyprus purchase, whatever passport you hold. You have six months from signing, and it secures your interest against later dealings by the seller while title is still being transferred. Why that matters so much, and what to do if a deed has never been issued, is set out on our title deeds page.
Cyprus abolished its national immovable property tax in 2017, and nothing has replaced it. What remains is local and modest: municipal or community rates, refuse and sewerage charges, and communal fees in a managed development. For most owners this is a few hundred euros a year rather than a meaningful holding cost.
Rental income is taxed at the normal income tax bands. The 2026 reform also removed rents from Special Defence Contribution entirely, for everyone, not just for non-doms, which is a genuine simplification for anyone letting a Cyprus property.
On the way out, capital gains tax is 20%, and it applies only to Cyprus immovable property. Gains on shares and most other securities sit outside the CGT net altogether, and crypto has its own flat 8% regime since January.
The 2026 reform raised the lifetime exemptions sharply, and these are the numbers most older guides still get wrong.
| Lifetime CGT exemption | Before 2026 | From 2026 |
|---|---|---|
| Main residence | €85,430 | €150,000 |
| Agricultural land | €25,629 | €50,000 |
| General exemption | €17,086 | €30,000 |
These are lifetime allowances, not annual ones, and they are not cumulative: you claim the one that fits the disposal. The main residence exemption carries a five-year occupation requirement. The reform also tightened an anti-avoidance rule, so a disposal of shares now falls into CGT where at least 20% of their value derives from Cyprus immovable property, down from 50%.
Ten pages: the reform in one table, the non-dom regime, the domicile test people get wrong, worked numbers and the honest country comparison. Free, instantly.
One email with the PDF. No sequence, no spam, unsubscribe is one click.
Whether a property qualifies for the reduced band, whether joint names help, and whether the purchase should sit alongside a residency application: all cheaper to decide before you reserve.
Every figure on this page was checked against primary legislation and official publications on 6 September 2026.
Where the wording above is cautious, that is deliberate. The 50% transfer fee reduction has been carried forward annually since 2012 rather than written in permanently, and the measurement of covered area for the reduced VAT band is a technical question that turns on the specific development. This page is general information, not tax, legal or investment advice, and it does not replace a lawyer acting for you on a specific purchase.