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Taxes, Permissions & Duties

Purchasing property in Cyprus is a fairly straightforward process based on English law. A non-EU member is allowed to purchase for personal use an apartment, a house, a villa, or a piece of land with an area no greater than 4,013 sq. m.

Acquiring Permission to Purchase Property

Permission to purchase property in Cyprus must be sought from the Council of Ministers via written application, which is to be submitted by a non-EU based buyer after the signing of the relevant purchase agreement. There shouldn’t be much reason to worry about denial, however, the permission is generally granted as a matter of course to legitimate buyers, so long as the application is filed within a reasonable amount of time after the signing of the purchase agreement.

EU citizens don’t need to apply for permission to purchase real estate in Cyprus. Furthermore, EU citizens can register any number of properties in their name. Meanwhile, non-EU citizens are entitled to freehold ownership of property upon securing permission to purchase it.

Stamp Duty

In regards to property purchase agreements, the purchasing party is responsible for the payment of stamp duty, which is payable within one month from the date of the agreement being signed. Should the purchaser fail to make this payment, a fine is imposed and increased daily until the payment has been made.

Stamp duty is payable at the following rates:

Value

Rate

First 5,000 Euro

0%

5,001 – 170,000 Euro

0.15%

Over 170,000 Euro

0.2%


For example:

With a purchase price of 400,000 Euro:

5,000 Euro at 0% = 0 Euro

170,000 Euro at 0.15% = 255 Euro

225,000 Euro at 0.20% = 450 Euro

Total Stamp Duty Due: 750 Euro

Land Registry

Once the stamp duty has been paid, the buyer’s agent submits the original agreement to the District Land Office in order to officially register the purchase. The land office stamps to the agreement and records it in the Land Registry, which secures ownership of the property with the buyer until a title deed is issued. This must be done no later than two months after the purchase agreement is signed. After the agreement is filed with the Land Registry, the buyer is free to apply to have the title for the property transferred to them.

Title Deeds

In Cyprus, title deeds serve as formal documents that prove property ownership. Each property has a title deed associated with it, containing information such as the registered owner, the size of the property, its location, and the reference it holds at the land office. Transferring ownership from the seller to the buyer is a simple procedure performed at the Cyprus Land Registry Office either by the buyer or a third party that holds power of attorney. It’s also worth noting that Cyprus law requires the payment of property transfer fees when transferring freehold property ownership to a new party.

Property Transfer Fees

The fees charged by the Department of Lands and Surveys for the transfer of real estate property are as follows:

Property Price

Rate

First 85,000 Euro

3%

85,431 – 170,000 Euro

5%

Over 170,000 Euro

8%


For instance, if a client purchases a property at 150,000 Euro, the tax will be 2,550 Euro (3%) for the first 85,000 Euro of that total, and 3,250 Euro (5%) for the remaining 65,000 Euro of the total, resulting in a total tax of 5,800 Euro.

Annual Property Tax

In Cyprus, annual property tax is imposed based on the market value of a property as of January 1st 1980. It applies on January 1st of each year to any property located in Cyprus and must be paid no later than September 30th of each year. This tax applies to both individuals and legal entities and can be paid to the Inland Revenue Department of the Republic of Cyprus. The minimum mandatory payment is 75 Euro.

The tax rates are as follows:

Property Value

Rate

Up to 40,000 Euro

0.6%

40,001 – 120,000 Euro

0.8%

120,001 – 170,000 Euro

0.9%

170,001 – 300,000 Euro

1.1%

300,001 – 500,000 Euro

1.3%

500,001 – 800,000 Euro

1.5%

800,001 – 3,000,000 Euro

1.7%

Over 3,000,000 Euro

1.9%


Local Authority Fees

Depending on the size of the property, local authorities charge between 85 and 256 Euro per year for trash collection, street lighting maintenance, sewage, and other community utilities. These fees are paid to the local municipal authority.

Capital Gains Tax

According to Cyprus law, if a foreign property owner decides to sell their property, the entire amount paid for it may be transferred abroad at the time of the sale. Property sales in Cyprus are subject to a capital gains tax of 20%, but the first 17,086 Euro are exempt. Should the original purchase agreement include two buyers (the maximum allowed), the tax exemption can be as high as 34,172 Euro.

Inheritance Tax

Inheritance tax is not imposed in Cyprus.

Tax Privileges

Personal effects, household goods, and furniture can be imported duty free by immigrant retirees, provided the items are for personal use only. The law also allows for the import of a duty free car, while retired couples are altogether allowed two duty free cars. Cyprus also has double taxation treaties with many countries in Europe and elsewhere, with the main purpose being to help people avoid double taxation of income earned in any of those foreign countries. Foreign pensions coming into the country are taxed at a flat rate of 5%, with an annual exemption of 3,420 Euro.

Water & Power

The property owner is responsible for paying utility bills to relevant organizations at regular intervals throughout the year. The amounts charged depend on individual consumption rates and the type/size of the property in question.

Insurance

Insurance against fires and other hazards is provided by the property developer until the title deed is transferred to the owner. The specifics of the insurance plan are the responsibility of the property owner, who can expect to pay anywhere between 255 and 1,788 Euro depending on the type of insurance purchased.

Living in Cyprus

Foreigners can file an application to obtain an immigration permit citing one of the categories in Regulation 5 of the Aliens and Immigration Regulations. An immigration permit is only granted in the event that the Immigration Control Board recommends to the Minister of the Interior that the individual in question belongs to one of the following categories.

Category A: An individual intending to hold self-employed status in the agriculture, cattle breeding, bird breeding, or fish cultivation fields in Cyprus, as long as said individual possesses adequate land or a permit to acquire such, and approximately 430,000 Euro in disposable income. The final condition is that the work performed by the individual in question must not negatively affect the economy of the republic.

Category B: An individual intending to work as a self-employed contractor for a mining enterprise in Cyprus, so long as the individual possesses the relevant permit and approximately 350,000 Euro in disposable income. As above, this individual’s employment must not pose a threat of harm to the economy of the republic.

Category C: An individual who intends to be self-employed in a trade or high skill profession in Cyprus, so long as the individual possesses the relevant permit and approximately 260,000 Euro in disposable income. As above, the individual’s employment must not pose a threat of harm to the economy of the republic.

Category D: An individual intending to be self-employed in a professional or scientific field in Cyprus, so long as the individual possesses relevant academic or professional qualifications that are in demand in the republic. The individual must also have sufficient funds to qualify.

Category E: An individual who has been offered permanent employment in Cyprus, so long as such employment doesn’t create undesirable local competition.

  Category F: An individual who possesses a secured annual income with sufficient disposable funds, enough to support a decent level of life in Cyprus without needing to engage in business or take up employment. The annual income required must be at least 10,000 Euro for a single applicant and an additional 5,000 Euro for every dependent, though the Immigration Control Board may impose additional requirements as it sees fit. Most applicants fall under this category, with the majority being retired individuals from other countries looking to move to Cyprus.


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Lucy villa
€ 450,000
5403 4 bedrooms
Larnaca / Pyla