Legal and Taxes in Cyprus

A Transparent, English-Based Legal System

Cyprus offers one of the most straightforward and secure property ownership systems in Europe.
The island’s legal framework is based on English common law, making it familiar, reliable, and easy to understand for UK buyers.
Every property purchase must be handled through the Cyprus Land Registry and supported by a legally registered Contract of Sale, ensuring full protection of the buyer’s rights.

Auckland Estates work with reputable, English-speaking Cypriot lawyers to guarantee each transaction is compliant, transparent, and properly recorded from reservation to title transfer.

Ownership and Legal Protection

Foreign nationals both EU and non-EU can freely purchase property in Cyprus.
Buyers are granted freehold ownership, giving them full control over their property with the same legal rights as Cypriot citizens.

To secure ownership, your lawyer registers the Contract of Sale at the District Land Registry Office within 60 days of signing.
This step prevents the seller from reselling or mortgaging the property and legally binds it to your name until title transfer is complete.

For newly built properties, title deeds are typically issued once the development is fully completed and inspected by the local authorities.

Purchase Costs and Fees

Buying in Cyprus involves some of the lowest acquisition costs in Europe.
Buyers should budget around 6–8% on top of the property price to cover the following:

  • Transfer Fees: 3–8% (depending on value; discounts apply if VAT has been paid).
  • Stamp Duty: 0.15% on contracts up to €170,000 and 0.20% thereafter.
  • VAT: 19% on new properties, reduced to 5% for first-time owner-occupiers.
  • Legal Fees: Approximately 1–1.5% of the property value.
  • Land Registry Fees: Nominal charges for title registration.

Your lawyer will provide a detailed breakdown of all costs before signing any agreements.

Annual Ownership Taxes

Cyprus abolished its national property tax in 2017, leaving only minor local levies that fund community services.
Typical ongoing costs include:

  • Municipal Taxes: Approximately €100–€300 per year (varies by location).
  • Refuse Collection Fees: Around €200 annually.
  • Communal Fees: For apartments or gated complexes, covering maintenance of shared areas.

There are no inheritance taxes and no annual property taxes, making Cyprus one of the most tax-efficient countries in Europe for property ownership.

Rental and Income Tax

Rental income from Cypriot property is subject to low and clearly defined tax rates:

  • First €19,500 of income per year: Tax-free.
  • €19,501–€28,000: 20% tax rate.
  • €28,001–€36,300: 25% tax rate.
  • Above €36,300: 30% tax rate.

Owners may also claim allowable deductions such as maintenance and insurance costs.
For short-term holiday rentals, registration with the Deputy Ministry of Tourism is required to obtain a licence.

Capital Gains and Inheritance

Capital Gains Tax (CGT) is charged at a flat rate of 20% on the profit from the sale of a property in Cyprus.
However, significant exemptions apply:

  • The first €85,430 of gain on the sale of a primary residence is tax-free.
  • Expenses such as transfer fees, improvements, and inflation adjustments can be deducted.

There is no inheritance tax in Cyprus, meaning property can be passed to heirs without additional state charges.
Foreign nationals are advised to have a Cyprus Will to ensure assets are distributed according to their wishes.

Residency and Visa Options

Property ownership in Cyprus can provide a route to residency for non-EU nationals:

  • Permanent Residency (Category F): For property purchases from €300,000 or more (new build only).
  • Temporary Residence (“Pink Slip”): Allows long-term stays for property owners.
  • EU Citizens: Automatically entitled to live and work in Cyprus without restriction.

Residency can include the investor’s spouse and dependants, and once granted, it remains valid indefinitely provided the property is retained.

Corporate and Tax Benefits

Cyprus is known for its attractive tax regime and business incentives:

  • Corporate Tax: 12.5% (one of the lowest in the EU).
  • No tax on foreign dividends or capital gains from overseas investments.
  • Double taxation treaties with over 60 countries, including the UK.

For investors purchasing through a company, these structures can optimise returns and simplify estate planning.
Auckland Estates can introduce clients to qualified accountants for tailored tax advice.

Legal Support and Due Diligence

Your lawyer will handle every stage of the process, including:

  • Drafting and registering the Contract of Sale
  • Applying for Council of Ministers approval (for non-EU buyers)
  • Conducting all Land Registry and planning searches
  • Managing payments, taxes, and title transfer

All funds are transferred through secure client accounts, ensuring complete traceability and compliance with Anti-Money Laundering (AML) regulations.

Why Work with Auckland Estates

We combine our UK heritage and professional expertise with the local knowledge of trusted Cypriot partners.
Our clients benefit from:

  • Verified developments with full title assurance
  • English-speaking lawyers and accountants
  • Guidance on tax planning and residency options
  • Transparent costs and no hidden fees

Auckland Estates provide full oversight throughout your purchase, giving you the peace of mind that every step is legally secure and properly documented.

Contact Us

For personalised advice on legal matters, taxation, or ownership structure in Cyprus, contact our International Department today.
📞 01707 664400 | 🌐 Auckland Estates – International, investment, or relocation opportunities in Cyprus, contact our International Department.