Buying Property
Property price in Cyprus is on average one fourth of the value in Western Europe.
This makes it possible for you to own a second home, for holidays or leisure,
a more luxurious retirement home, or even a lucrative investment opportunity.
Although so much cheaper it appreciates steadily over the years
and especially during the last five, on a rate of 15 to 20% per year
depending on location. Accompanied by a strong currency your property’s net
worth is growing at a very healthy pace.
With the European Union accession from May 1st 2004,
a healthy and growing economy, a rising overseas property demand
and the right for multiple ownership and rent out by all member state citizens,
provide the foundation for a momentum that will keep healthy property
price growth for a good many years to come.
Fees & Taxes
After the transfer of the property, the District Land Registry Office will charge transfer Fees,
based on the property's value:
For up to €1.71 – 85,430.07 -3%
For € 85,430.28 - € 170.860,14 -5%
For € 170.860,14 - and over -8%
A stamp duty-at the rate of € 1,5%0 up to € 170.860,14 and
thereafter at the rate of 2%0 is due at the time of signing the Contract.
If you spend more than 183 days per year in Cyprus, you become a Cypriot resident
and taxed on your global income according to Cypriot tax regulations.
Individuals that become tax residents of Cyprus pay an annual 5% income tax,
while € 3,417.20 are tax exempt, applying to amount remitted to Cyprus from pensions
or income arising from overseas investments. Moreover, double taxation treaties
signed with a number of countries assures that you won’t be double taxed
(Russia, United Kingdom, Ireland, Netherlands, Italy, France to name a few)
For purchasers who are not tax residents of Cyprus, but of the UK,
rental income from property rented, is taxable in Cyprus,
however amounts can be offset against the purchaser’s income tax
due in the UK to the extent foreseen by the double taxation treaty
between the UK and Cyprus. Also, 20% of rental income may be deducted
for expenses assumed to be required maintaining the property you are renting.
If you are a Cypriot tax resident, rental income incurs a further small
defense tax calculated as 3% of 75% of the total annual amount of your rental income.
Property sales are subject to a capital gains tax at the rate of 20% on the gain.
However the first € 17,086.01 is exempted and there is an indexation allowance.
Inheritance Tax is not payable on property purchased by non-Cypriots
when the beneficiary is not in Cyprus.
Personal effects, household goods and furniture can be imported free of any taxes
by immigrant retirees, provided they are for personal use and have been used for a
reasonable amount of time - approximately one year. There is no duty on a car, and for
retired couples there is an additional concession of two duty free cars.
Non Cypriots Residing in Cyprus
By law, a non-Cypriot who owns property in Cyprus is entitled to a residence permit,
but is not required to hold a permanent residence permit. For EU citizens there are no restrictions.
They just have to complete an application form at the immigration office for formality purposes,
and automatically they receive their residence permit. For non-EU citizens there is a straightforward
procedure that needs to be followed. However, permanent residence is easy to obtain.
The applicant needs to submit an application and provide proof that he and his family are self-supported.
The following documents must accompany the application:
1. A copy of the sale/rental agreement
2. Copies of pension/retirement income
3. Any other document relevant to income
4. Three photos and passport
The application for permanent residence may be submitted to the local immigration office in the area of residence.
Under the Aliens and Immigration Law, non-Cypriots wishing to take up employment in Cyprus
are required to have a work permit. EU citizens can acquire one very easily,
just by having the approval of the Ministry of Labor, again a matter of formality.
Acquiring The Title Deed
Transfer of ownership from vendor to purchaser is accomplished by a simple procedure
through the Cyprus Land Registry Office, either by the buyer in person or
by appointed third party with a Power of Attorney.
In the case of a non-Cypriot, evidence of payment for the property with foreign exchange
must be provided as a prerequisite for registration. The contract of sale must be in writing,
and it is advisable that such contracts be registered at the District Land Registry Office
within sixty days from the contract date. This protects the buyer's rights to the
property and provides additional safeguards.
When issued, the title deed will be register in the name of the buyer,
and will be recorded in the Government archives. The Government archives are confidential
and will not be published or made accessible under any circumstances. At any time after the purchase,
the buyer may sell or dispose of the property at will, provided that he/she has a valid contract.
