Property Taxes & Fees in Cyprus

When purchasing property in Cyprus, buyers should be aware of several government-imposed fees and taxes. Below is a breakdown of the main costs involved:

1. Stamp Duty (Σημανση)

Stamp Duty is paid by the purchaser upon signing the Contract of Sale.

• Stamp Duty Rates

• Maximum Stamp Duty: €20,000 per contract.

📌 Note: Stamp duty is payable within 30 days of signing the contract.

Example Calculation for Property at €450,000:

• €5,000 x 0% = €0
• €165,000 x 0.15% = €247.5
• €280,000 x 0.2% = €560
• Total Stamp Duty = €805.5

2. Land Transfer Fees (Μεταβιβαστικά Τέλη)

Land Transfer Fees are payable to the Department of Lands and Surveys upon the transfer of the property title deed into the buyer’s name.

• Transfer Fee Rates (based on property value):

💡 Good to know:

• If VAT has been paid on the property (see below), no transfer fees are payable.
• 50% discount may apply for certain property transactions (e.g. family transfers, incentives for new buyers – subject to government policy at time of purchase).
• It is noted that transfer fees for Cypriot properties are calculated on the basis of the market value of the property on the date of purchase. 

Examples of Transfer Fee Calculations

• Single Purchase: For a property valued at €250,000, the Transfer Fee would typically be calculated as follows:
  •  €85,000 x 3% =€2,550
  •  €85,000 x 5% =€4,250
  •  €80,000 x 8% = €6,400 
  • Total €13,200 x 50% discount = €6,600.

3. VAT on Property (Φ.Π.Α.)

VAT is applicable only on new properties sold for the first time by a developer or constructor.

• Standard VAT Rate: 19%
• Reduced VAT Rate (5%): Available for eligible first-time buyers on their primary residence.

📝 Eligibility Criteria for 5% VAT:

• Buyer must be an individual (not a company), 18 years of age and over.
• The property must be used as the main residence for a minimum of 10 years and not for profit (such as from renting).
• The reduced rate applies to the first €350,000 of the property’s value, and only if the total value does not exceed €475,000. Additionally, it applies to the first 130 sq.m. of the property’s area, provided the total covered area is below 190 sq.m.
• The reduced rate applies to the first 200m² of the buildable area for properties with planning permits issued until 31 October 2023.

4. Capital Gains Tax (CGT)

Capital gains tax (CGT) in Cyprus applies to gains realised on the sale of real estate located in Cyprus or shares in companies with significant holdings of real estate in Cyprus. The CGT rate is set at 20%, which is applied to the taxable gain, calculated by deducting allowable expenses from the sale price. These may include:

• Transfer fees paid at the time of purchase,
• Costs of renovation or improvement (provided they are duly documented and approved),
• Estate agent’s fees (only if paid to a licensed estate agent),
• Legal expenses incurred during the sale.

Lifetime Allowances

Under Cypriot law, individuals (and not Cypriot companies) have access to certain lifetime allowances that reduce their taxable profit and therefore their CGT liability. It is important to note that each allowance only applies once per individual, but any unused amount can be carried forward to a future sale if not fully utilised in a single transaction. These include:

• General Allowance: Individuals are entitled to a tax-free allowance of €17,086 on any property sale. This allowance applies to each person and is often used in cases where the property does not qualify as a primary residence.
• Primary Residence Allowance: For individuals selling their primary residence, an increased allowance of €85,430 is available. To qualify, the property must have served as the individual’s main residence for at least five years. Substantial documentation (such as utility bills or official residence records) is required to claim this exemption.
• Agricultural Land Allowance: For registered farmers, an additional allowance of €25,629 applies to the sale of agricultural land used in farming activities.

* Pavlou Real Estate  does not have any responsibility for any of the above information. Please note that the content of this document is meant to provide a general guideline only and does not constitute legal advice.