What is the personal income tax system in Cyprus?

Cyprus operates a progressive personal income tax system for tax residents, taxing worldwide income. Non-residents are taxed only on Cyprus-sourced income.


Income Tax Rates (2025):

  • Up to €19,500: 0%

  • €19,501 – €28,000: 20%

  • €28,001 – €36,300: 25%

  • €36,301 – €60,000: 30%

  • Over €60,000: 35%


Tax Residency Criteria:

An individual is considered a tax resident of Cyprus if they meet either of the following conditions:

  • Spend more than 183 days in Cyprus during the tax year.

  • Spend more than 60 days in Cyprus, are not a tax resident elsewhere, have a permanent home in Cyprus, and carry on business in Cyprus.


Special Tax Regimes:

  • Foreign Pension Income: Taxed at 5% on amounts exceeding €3,420.

  • First Employment in Cyprus: Eligible individuals can benefit from a 50% tax exemption on remuneration for up to 17 years, provided certain conditions are met.


Social Insurance Contributions:

  • Employee: 8.3% of gross salary.

  • Employer: 8.3% of gross salary.

  • State Contribution: 5.2% of gross salary.

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