When purchasing real estate in Cyprus, one important decision is whether to buy as an individual or through a company. Each option has unique financial, legal, and tax implications. In this article, we’ll explore the pros, cons, and one major tax benefit that can make corporate ownership especially attractive in 2025.
Why Buy Property Through a Company in Cyprus
Buying through a Cyprus-registered company offers several strategic advantages, particularly for investors and business owners with long-term goals.
1. Asset Protection
Owning property through a company separates business and personal assets.
This protects you from personal liability and simplifies estate or inheritance planning.
2. Tax Optimization
Cyprus boasts one of the lowest corporate tax rates in the European Union — just 12.5%.
Holding property under a company may reduce overall tax exposure, particularly for rental income and business-related gains.
3. Claiming VAT Refund on New Developments
One of the biggest advantages of buying through a company is the ability to reclaim VAT (Value Added Tax) on new property purchases.
Under Cyprus VAT Law, companies registered for VAT and engaged in business or rental activities can claim back the 19% VAT charged on newly built properties — provided the property is used for commercial or income-generating purposes (e.g., rental or resale).
Example:
If your company buys a €400,000 new apartment (subject to 19% VAT = €76,000), you can claim the full €76,000 VAT refund through the Tax Department — significantly reducing your investment cost.
This makes company ownership particularly beneficial for investors buying off-plan or rental properties.
4. Easier Property Management
For investors managing multiple rental units, owning them under a single company simplifies accounting, expense deductions, and tax filing.
5. International Flexibility
Non-EU investors often find it easier to structure their property purchases through a Cyprus company, allowing them to hold multiple properties and streamline future sales or ownership transfers.
When It Might Not Be Worth It
While company ownership provides advantages, it isn’t ideal for everyone.
Administrative costs: annual audits, accounting, and filings
Complex tax reporting: depending on your home country’s tax rules
Permanent Residency (PR): buying through a company does not qualify for PR, unless the company is fully owned by the applicant and family
When Company Ownership Makes the Most Sense
You may benefit from buying through a company if you:
Plan to purchase and rent multiple properties in Cyprus
Want to claim VAT refund on a new development
Need asset protection or shared ownership structure
Intend to sell or transfer properties in the future under corporate shares
Company vs Individual Ownership in Cyprus
| Factor | Company Ownership | Individual Ownership |
|---|
| Tax Rate | 12.5% corporate | Up to 35% personal |
| VAT Refund | ✅ Yes (if registered) | ❌ No |
| PR Eligibility | ❌ Not directly | ✅ Yes |
| Maintenance Cost | Moderate (audit, accounting) | Low |
| Privacy | ✅ Higher (via shares) | ❌ Public title record |
| Ideal For | Investors, businesses | End-users, PR buyers |
Final Thoughts
Buying property in Cyprus through a company can be a smart financial strategy — especially if you’re investing in new developments, rental properties, or business-use real estate.
The ability to claim back 19% VAT makes this structure one of the most tax-efficient ways to invest in Cyprus property in 2025.
However, if your main goal is Permanent Residency or a personal home, individual ownership remains the simpler route.
Always consult a licensed tax advisor or lawyer in Cyprus before purchasing to ensure full compliance and maximize your benefits.
