Taxes related to real estate - Cyprus

Taxes and fees that currently affect the acquisition of real estate in Cyprus include the following:

Stamp duty: Stamp duty is payable on any document which concerns property situated in Cyprus, irrespective of the place of execution of the document. Rates are as follows:

Value of contract	Stamp duty
Between €1 and €5.000	nil
Between €5.000 and €170.000	€1,50 for every €1.000
Over €170.000	€2,00 for every €1.000 with a maximum stamp duty of €20.000.

Property transfer fees: Property transfer fees are charged by the Department of Land and Surveys as follows:

Market value of property	Rate
First €85.000	3%
Between €85.001 and €170.000	5%
Over €170.000	8%

However, no transfer fees are payable for properties which are subject to VAT.

Immovable properties which are not subject to VAT are eligible for a 50% exemption from property transfer fees.

VAT: New properties are subject to tax at 19%.

Subject to certain criteria, VAT may be reduced to 5%. This reduced rate applies on the first 200 square metres of the property and it is imposed only after the buyer obtains the relevant certified confirmation regarding their eligibility. The criteria are:

The property has to be the applicant’s primary residence (e.g. it cannot be rented out).

The property has to be the applicant’s permanent place of residence for the following 10 years.

The applicant has not acquired any other property in Cyprus with a reduced VAT rate.

Immovable property tax has been abolished as from 1 January 2017. Today, ownership of real estate results in the following taxes and fees:

1. Local authority fees: This will depend on the size and location of the real estate. Local authorities will charge an annual fee of €85 – €500 for regular refuse collection, road maintenance, sewerage, and similar commodities. This is payable to your local municipal authority.
2. Municipality tax: It is an annual charge based on the estimated value of the property as at 1 January 1980, with rates varying between 0.1% -0.2%. This too is payable to your local municipal authority.

3. Sewerage tax: As above, sewerage tax is charged based in the estimated value of the property as at 1 January 1980, with rates varying between 0.3% -0.7%. This is payable to your local sewerage