Buying real estate in Cyprus is a smart move for lifestyle and investment purposes, but if you’re a non-Cypriot or non-EU national, it’s important to understand the tax side of things. This guide covers all key Cyprus property taxes for foreign buyers in 2025, including purchase taxes, annual fees, and non-domicile advantages.
VAT on Property Purchases
For new properties (first sale from a developer):
5% VAT applies on the first 200m² for eligible buyers using the property as their main residence
19% VAT applies on the remaining area
For resales:
No VAT (but transfer fees apply)
Tip: Most PR-eligible off-plan apartments are subject to VAT, but developers often bundle furniture and PR fees into the price.
Property Transfer Fees (Only on Resale Properties)
Transfer fees are calculated on a sliding scale:
3% on the first €85,000
5% on the next €85,000
8% on the amount above €170,000
If the property is in joint names (e.g. couple), the value is split in two for lower tax.
New builds (with VAT) are exempt from transfer fees.
Stamp Duty
Applies to all sales contracts:
0.15% on the first €170,000
0.20% above that
Capped at €20,000 per property
Who pays it? The buyer, upon signing the contract.
Annual Property Taxes in Cyprus
Municipality tax: 0.1% to 0.2% of the property’s market value (paid yearly to the local authority)
Sewerage and refuse fees: Around €100–€300/year
Immovable Property Tax (IPT): Abolished since 2017
Annual costs are generally low compared to other EU countries.
Rental Income Tax (If You Let the Property)
If you rent your property:
Taxed at progressive rates from 20% to 35%
Expenses (management, repairs, etc.) are deductible
PR or non-domicile status can reduce overall liability
Airbnb or short-term rentals may require a license in certain zones.
Capital Gains Tax (When You Sell)
20% capital gains tax applies on net profit
First €17,086 is tax-free (once per person)
Deductions apply for improvements, legal fees, inflation
Properties held in a company may be subject to corporate tax rules.
Non-Domicile Status: Tax Perks for Foreigners
If you move to Cyprus and register as non-domiciled:
No tax on dividends, interest, or worldwide income for 17 years
Only Cyprus-sourced income is taxed
Great for: Foreign retirees, business owners, and high-net-worth individuals.
Summary Table: Cyprus Property Taxes for Foreign Buyers (2025)
Tax Type Rate / Detail
| Tax Type | Rate / Detail |
|---|---|
| VAT | 5% (first 200m²), 19% above that (new builds) |
| Transfer Fees | 3% to 8% (only on resale) |
| Stamp Duty | 0.15% – 0.20%, capped at €20,000 |
| Annual Local Tax | ~0.1% – 0.2% of property value |
| Rental Income Tax | 20% to 35%, deductions allowed |
| Capital Gains Tax | 20% on profit, with exemptions |
| Non-Dom Status | Exempts most foreign income |
Need Help Planning Your Tax-Efficient Purchase?
We work with experienced tax advisors and property lawyers in Cyprus to help foreign buyers:
Calculate full cost scenarios
Structure purchases for PR and tax benefits
Select properties with the best long-term returns
[Request Tax Consultation] | [Browse PR-Eligible Properties] | [Download Full Tax Guide]
