The accession of Cyprus to the European Union triggered a bold tax reform that aimed towards the alignment of the legislation with EU’s Acquis Communautaire and Code of Conduct of Business Taxation as well as the compliance with the requirements of the Organisation for Economic Co-operation and Development (OECD).
Income from dividends is exempt from tax regardless of its source. Exemption to the general rule is when:
Cyprus offers considerable incentives for personal tax residency. Complementing the tax legislation are the island’s ideal geographical location, its EU membership, its robust legal system and reliable political environment.
With regard to personal taxes, Cyprus has one of the lowest top statutory personal income tax rates of 35% for net income exceeding €60.000 annually and no tax on net income of up to €19.500. At the same time, it also offers a number of very attractive personal tax incentives, through tax exemptions and deductions, in order to attract high net worth individuals of all ages.
Below is an analysis of the main provisions of Cyprus’ personal income tax regime as well as the key tax incentives provided to individuals who wish to relocate to Cyprus.