Corporate
Corporate Tax Hikes to 15% in 2026
Cyprus aligns with the global minimum tax framework. Learn how the new 15% rate impacts your business and what exemptions apply.
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Latest Updates
Cyprus Tax News Hub
Stay ahead with the latest announcements on the 2026 Tax Reform.
Business
Dividend Tax Slashed to 5%
Great news for shareholders! The Special Defence Contribution (SDC) on dividends drops from 17% to just 5%, balancing the corporate hike.
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Personal
Tax-Free Income Raised to €22,000
Middle-income earners get a break. The tax-free threshold increases, and new progressive brackets are introduced to lower the burden.
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Crypto
Crypto Tax Set at Flat 8%
Digital assets get regulatory clarity. Profits from crypto disposals will be taxed at a competitive flat rate of 8% starting 2026.
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For Employees
Tax-free threshold raised to €22,000. New progressive brackets significantly reduce the burden for middle earners.
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For Business
Corporate Tax increased to 15%, balanced by a sharp cut in Dividend Tax (SDC) to just 5%.
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For Investors
New 8% Flat Tax on Crypto assets. Special Defence Contribution (SDC) on rental income is fully abolished.
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Green & Crypto
Crypto: 8% Flat Tax on profits.
Stock Options: 8% Tax (3-year vesting).
Green Deductions: Up to €1,000 for energy upgrades/EVs.
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Family & Housing
Child Tax Credit: €1,000 - €1,500 benefit.
Housing Deduction: Up to €2,000 for mortgage interest or rent.
Transfer Pricing & SIT
Essential compliance for related party transactions.
Transfer Pricing Study
Benefits & When you need it
- Compliance: Mandatory for "related party" transactions (e.g., between companies with >25% common ownership).
- Risk Reduction: Avoids tax adjustments and penalties by proving "arm's length" pricing.
- Thresholds: Required if category transactions >€750k/year (or €5m for financing).
SIT (Summary Information Table)
Mandatory Filing Requirements
- What is it? A summary table listing all intercompany transactions.
- Who files? ALL companies with related party transactions (no threshold).
- Deadline: Filed electronically with your Tax Return (15 months after year-end).
- Penalty: €500 fine for late submission.
SDC on Dividends & Interest
Special Defence Contribution
- Dividends: Reduced to 5% (from 17%).
- Interest: 17% Standard / 3% Reduced (Bonds/Funds).
- Disguised Divs: New 10% levy on asset usage.
- Non-Dom Promo: Option for €50k Lump Sum p.a. vs actual SDC.
🛒 VAT Rates 2026
Standard 19%| Rate | % | Scope |
|---|---|---|
| Standard | 19% | Most goods & services. |
| Reduced | 9% | Hospitality, Restaurants, Cafes, Taxis. |
| Reduced | 5% | Renovation (primary residence), Foodstuffs, Medicines. |
| Zero | 0% | Baby milk/diapers, Fruits/Veg, Fem. Hygiene (Extended to end 2026). |
👥 Social Insurance (2026)
Cap €66k| Fund | Employer | Employee |
|---|---|---|
| Social Insurance | 8.8% | 8.8% |
| Redundancy Fund | 1.2% | - |
| Cohesion Fund | 2.0% | - |
| Training (HRDA) | 0.5% | - |
| Total | 12.5% | 8.8% |
*Max Insurable Earnings 2026: €66,612 (Monthly: €5,124)
Tax Residency
How to become a Cyprus Tax Resident.
183-Day Rule
Spend more than 183 days in Cyprus within a calendar year.
60-Day Rule
Spend at least 60 days in Cyprus AND:
- Do not reside in any other country >183 days.
- Are not tax resident elsewhere.
- Have permanent home in Cyprus (rent/own).
- Carry out business/employment in Cyprus.
Mandatory Filing
New 2026: All tax residents (aged 25+) must file a tax return, even with zero income.
CGT & Enforcement
New levies and strict compliance measures.
🏗️ Capital Gains Tax
- Share Disposal: Tax on disposal of shares in property-holding companies (if gain >€150k).
- Antiparochi: "Land-for-unit" deals must be completed within 5 years or face tax.
- Share Definition: Threshold for property valuation lowered to 20%.
⚠️ Strict Enforcement
- Seizure of Shares: Commissioner can seize shares for debts >€100k (>30 days overdue).
- Business Suspension: Premises sealed for 10 days if debts >€20k or failure to file returns.
- Digital Rent: Cash for rent is PROHIBITED. Must use Card/Transfer.
- Directors' Liability: Remains after resignation.
Impact Calculator
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Advanced Mode (Deductions & Exemptions)
Vision
Understanding the
Understanding the
Cyprus Tax System
The 2026 reform isn't just a tweak—it's a complete overhaul designed to attract talent and investment. We break down the complex legal frameworks into actionable insights for you.
Check Your Impact →Personal Income
New €22k tax-free limit.
Corporate Tax
Standard rate at 15%.
VAT Standard
Remains at 19%.
✨ Special Tax Exemptions
You might be eligible for special tax treatments.
Non-Dom Status
0% Tax
The "Holy Grail" of Cyprus Tax: The Non-Domiciled (Non-Dom) status offers the most competitive tax advantage in the EU. Qualifying individuals are 100% exempt from SDC for 17 years.
- Dividends: 0% Tax (Standard: 5%).
- Interest Income: 0% Tax (Tax-Free).
- Rental Income: 0% SDC.
Foreign High Earners
50% Off
First Employment Rule: Designed to attract top talent. If you relocate to Cyprus for a job with an annual salary exceeding €55,000, you qualify for this massive deduction.
- 50% Income Tax Exemption: Only half your salary is taxable.
- Duration: Valid for up to 17 years.
Foreign Pensioners
5% Flat
Retire in Cyprus: Foreign pensions are taxed favorably, ensuring your retirement savings go further.
- Option A: Standard progressive rates (Tax-free up to €22k).
- Option B: Flat 5% tax on any amount exceeding €3,420. Users can switch options annually!
Green & Crypto
New 2026
Cyprus Crypto Tax: Gains from the disposal of crypto assets are now regulated and taxed at a competitive flat 8%.
Green Deductions: Get rewarded for sustainability. Reduce your taxable income by up to €1,000 for purchasing Electric Vehicles (EVs) or making home energy upgrades.
📥 Official MOF Forms
Direct links to the Tax Department.
Quick FAQ
Tax-Free Limit? €22,000
Crypto Tax? 8% Flat