Cyprus offers one of the most attractive tax systems in Europe. As a member of the EU, Cyprus regulatory regime is in full compliance with the requirements of the EU and OECD, with one of the lowest corporate tax rates in the Europe and multiple exemptions for corporates and individuals.
With the correct advanced planning, those who choose to become tax residents of Cyprus are able to minimise and even eliminate tax on income. Being a non-domiciled tax resident in Cyprus also provides additional tax benefits.
The 183-day Rule
In order for an individual to be considered a tax resident of Cyprus, he/she needs to be physically present in Cyprus for more that 183 days of the calendar year.
The 60-day rule
The “60-day rule” applies to individuals who meets all of the following requirements within the tax year:
- Reside in Cyprus for at least 60 days per annum
- Have obtained a Permanent Residency of the Republic of Cyprus
- Do not reside in any other single state for more than 183 days
- Are not tax resident in any other country
- Have a place of the permanent residency in Cyprus
Qualifying applicants are issued a Residency Certificate and Tax Identification Number.
A tax resident individual will be treated as domiciled in Cyprus if they are either:
- Domiciled by origin (born to a Cypriot-domiciled father)
- Have been a Cyprus tax resident for at least 17 of the previous 20 years
All other tax residents are deemed as Non-Domiciled.