2022-2023 Cyprus Country Report

CYPRUSCOUNTRY REPORT 2022
TAX INCENTIVES FOR EXPATRIATE EMPLOYEES TAKING UP EMPLOYMENT IN CYPRUS:
The individuals who were non-Cypriot tax residents prior to the commencement of
their employment, but become Cypriot tax residents afterwards, are eligible for a 50%
exemption from income tax if all the following conditions are met:
• their remuneration from the employment exercised in Cyprus is over €55,000 per
annum; and
• they were not tax residents of Cyprus for 10 consecutive years prior to the
commencement of their employment; and
• the exemption is available from 1 January 2022, it is granted from the first year of
employment and it can be enjoyed for a period of 17 years
• individuals with annual remuneration below €55,000 who were non-Cypriot
tax residents in the 3 years preceding their employment, are eligible for a 20%
exemption from income tax (maximum exempt amount is €8,550 per year)
The exemption is available from the 1 st of January following the year of commencement
of the employment and can be enjoyed for a period of 7 years.
It is important to note that the above provisions were recently introduced (published
in the Official Gazette of the Republic on 26/07/2022 ) as amendments to the previous
rules that were applicable until the publication date. The amended provisions also
include certain transitional provisions that may enable the individuals that claimed
the exemptions based on the previous rules to enjoy the exemptions based on the
provisions included in the new rules. Furthermore, the individuals that do not fall within
the transitional provisions, are eligible to continue claiming the exemption based on the
previous rules for the remaining years, without being affected by the new rules.
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