Taxes & Fees
Usually the relative fees and charges for the acquisition of Immovable Property in Cyprus are paid by the Purchaser. These include legal fees as well as transfer fees, stamps and other fees imposed by the Cypriot authorities.
When registering the property under his / her name, the purchaser will be liable to pay the following transfer fees, calculated according to the property's market value:
|Market Value €/CY£||Fees Rate|
|Up to €85,430 (CY£50,000)||3 %|
|From €85,430 (CY£50,000) – €170,860 (CY£100,000)||5 %|
|Over €170,860 (CY£100,000)||8 %|
A calculator is available to calculate fees on the government web site but this is provided as a guide only.
The purchaser is also liable for the payment of stamp duty at the rate of 0.15 % of the market value of the property up to €170,860 (CY£100,000) and 0.20 % for over €170,860 (CY£100,000).
The contract should be stamped within a period of thirty (30) days from signing.
Although the absence of the revenue stamp on a contract does not render it void, the stamp must be paid before depositing the contract to the Land Registry for specific Performance purposes (see SPECIFIC PERFORMANCE above).
The stamp duty plus a fine will be payable when the contract is produced to the Land Registry for the transfer of ownership or to any Government department and the court.
CAPITAL GAINS TAX:
Capital gains tax is levied at the rate of 20% on gains realised from the disposal of immovable property or the disposal of shares of companies the assets of which consist mainly on immovable property.
The gain is calculated as the difference between the sales proceeds and the original cost of the property. Interest on payments paid for the acquisition, additions to the property and inflation rate, as published yearly by the Government, are deducted from gains.
Individuals are entitled to the following lifetime allowances on Capital Gains Tax:
The first €17,086 (CY£10,000) of gains arising from the disposal of any property are exempted.
The first €25,629 (CY£15,000) of gains arising from the disposal of agricultural land by farmers are exempted (subject to conditions).
The first €85,430 (CY£50,000) of gains arising from the disposal of a house used by the owner for his / her own habitation are exempted (subject to conditions).
The following allowances are not available separately and every individual is only allowed a maximum lifetime allowance of €85,430 (CY£50,000).
Non – residents are only charged when selling property in Cyprus but they can be totally exempt from Capital Gains Tax if they can prove that the purchase consideration was paid with foreign funds imported between August 1st 1980 and July 13th 1990.
The following categories of immovable property disposals are exempted from the Capital Gains Tax:
- Transfers by reason of death.
- Gifts between relatives up to third level of relationship.
- Gifts to limited liability companies when, at the time of transfer and for a period of five years following the transfer, all the shareholders of the company are members of the family of the donor.
- Gifts by family companies to their members, but only in cases where the property transferred, was obtained by the company as a gift.
- Exchanges of immovable properties.
- Compulsory acquisitions.
- Gifts to charitable institutions or the Republic of Cyprus.
For more information visit the official website of the Ministry of Finance of Cyprus at : www.mof.gov.cy