Cyprus: Cyprus immovable property tax reform

International Tax Review is part of Legal Benchmarking Limited, 1-2 Paris Garden, London, SE1 8ND

Copyright © Legal Benchmarking Limited and its affiliated companies 2025

Accessibility | Terms of Use | Privacy Policy | Modern Slavery Statement

Cyprus: Cyprus immovable property tax reform

kokoni.jpg
karastergios.jpg

Zoe Kokoni

Nicholas Karastergios

The Cyprus Council of Ministers has approved the reduction of immovable property tax rates by 50% from 1 per thousand (that had been initially proposed) to 0.5 per thousand.

The decision, which was approved on June 1 2016, of the reduction of the immovable property tax rate came following the obligation by the EU to charge VAT (at the current rate of 19%) on transactions of properties which constitute a commercial transaction. This VAT will be imposed on commercial transactions and will thus mainly impact land developers. Individuals will only be taxed in cases of purely commercial activity.

The following amendments are included in the proposal:

  • Reduction of immovable property tax rate to a flat rate of 0.5 per thousand;

  • Immovable property taxes up to €25 ($28) will not be collected;

  • The existing 20% discount for individuals who repay the immovable property tax on time via the internet or credit institutions and the 17.5% discount for individuals who pay their immovable property tax on time at the tax department counters will be maintained;

  • Immovable property taxes collected by municipalities and communities will be abolished;

  • A 50% reduction in land transfer fees. This was already applicable for transfers that took place between July 16 2015 and December 31 2016, but will now become a permanent reduction; and

  • Imposition of VAT of 19% on trading of land for construction.

Our team at Eurofast Taxand is in the best position to advise and assist you concerning the matter and any further enquiries you may have.

Zoe Kokoni (zoe.kokoni@eurofast.eu) and Nicholas Karastergios

Eurofast Taxand Cyprus

Tel: +357 22 699 222

Website: www.eurofast.eu

more across site & shared bottom lb ros

More from across our site

Canadian Prime Minister Mark Carney and US President Donald Trump have agreed that the countries will look to conclude a deal by July 21, 2025
The firm’s lack of transparency regarding its tax leaks scandal should see the ban extended beyond June 30, senators Deborah O’Neill and Barbara Pocock tell ITR
Despite posing significant administrative hurdles, digital services taxes remain ‘the best way forward’ for emerging economies, says Neil Kelley, COO of Ascoria
A ‘joint understanding’ among G7 countries that ‘defends American interests’ is set to be announced, Scott Bessent claimed
The ‘big four’ firm’s inaugural annual report unveiled a sharp drop in profits for 2024; in other news, Baker McKenzie and Perkins Coie expanded their US tax benches
Representatives from the two countries focused on TP as they met this week to evaluate progress under a previously signed agreement – it is understood
The UK accountancy firm’s transfer pricing lead tells ITR about his expat lifestyle, taking risks, and what makes tax cool
Dolphin Drilling intends to discuss the final liability amount and manner of settlement with HM Revenue and Customs
Winning the case against the 20% VAT imposition was always going to be an uphill challenge for the claimants, UK tax advisers argue
A ‘paradigm shift’ in Chile’s tax enforcement requires compliance architecture built on proactive governance, strategic documentation and active monitoring of judicial developments
Gift this article