VAT in Cyprus

Value added tax in Cyprus

Value Added Tax was introduced in Cyprus on 1 July 1992 and is imposed on the provision of goods and services as well as on the importation of goods into Cyprus. Only businesses that are registered for VAT can charge VAT, when registered VAT is added on all taxable sales (output tax) supplied in Cyprus and to non-VAT registered parties within the EU. VAT applied to sales invoices is referred to as "output tax". VAT applied to purchase invoices is referred to as "input tax".

Cyprus Vat rates

Standard rate: 19%

Reduced rates: 9%; 5%; 0%

Zero Rate

  • Export of goods to non EU countries and Intra-community supplies of goods
  • Foodstuffs (except those taxed at 5% or 19%)
  • Supplies of medicine falling

5% Rate

  • Hotel accommodation
  • Funeral services
  • Road sweeping, refuse collection and recycling
  • Services provided by; writers; artists and composers
  • Supply of fertilizers; animal feeding stuffs; seeds
  • Supply of live animals for human consumption
  • Books, magazines and newspapers
  • Gas
  • Non-bottled water;
  • Transport of passengers and luggage by bus
  • Camping caravan parks
  • Various goods for the use of handicapped persons
  • Medicines and vaccines; Contraceptives; Women's sanitary products; medical equipment when intended for the exclusive personal use of disabled persons
  • Medical services (medical examinations or surgeries of cosmetic nature are not included);
  • Ice-cream, yogurt ice-cream and similar products as well as certain salted or spicy products made from cereal, salted or spicy products made from potato and dry roasted or spicy nuts which are used for human consumption;
  • Supply of food in the form of catering services from school canteens
  • Services related to the renovation of property (when lived in for more than 3 years) which is primary residence; construction; plumbers, electricians, carpenters and oil painters. When the cost of materials exceeds 50% of the total value, VAT shall be charged at 19% on the value of the materials and the reduced rate of 5% on the value of service
  • Hair salon services
  • Confectionery items; bottled water; manufactured beverages; juice drinks (except those taxed at the standard VAT rate)
  • Food ingredients which are used in the preparation of foodstuffs and food supplements and foodstuffs substitutes
  • Admission to cultural sporting and certain entertainment events and facilities

Reduced rate of 9%

  • Transportation of passengers and luggage by taxi or sea
  • Restaurant services and the supply of food (not the supply of alcoholic drinks)
  • Hotel accommodation

Regustration VAT fees in Cyprus

  (Compulsory)
Taxable person must register when:

  • Its taxable supplies exceeds the €15.600 threshold during the 12 preceding months or
  • It expects that its taxable supplies will exceed the €15.600 threshold within the next 30 day
  • Receives goods in Cyprus of a value exceeding €10.251,61
  • Provides services to another EU VAT registered person within European Union
  • Receives services from countries outside the European Union

VAT in Cyprus

Exempt Supplies

  • Rental income derived from immovable property
  • Financial Services
  • Medical services
  • Postal services
  • Insurance services
  • Social welfare
  • Education
Reduced VAT in Cyprus

rate of 5% for new property

Imposition of the reduced rate of 5% on the acquisition and/or construction of residences for use as the primary and permanent place of residence. The reduced rate of 5% applies to contracts that have been concluded from 1 October 2011 onwards provided they relate to the acquisition and/or construction of residences to be used as the primary and permanent place of residence for the next 10 years. For contracts concluded up to 30 September 2011 for the acquisition and/or construction of residences for use as the primary and permanent place of residence, the eligible person must apply for a grant. The reduced rate of 5% applies for the first 200 square meters of residences of total covered area of up to 275 square meters. In the case of families with more than 3 children the allowable total covered area increases by 15 square meters per additional child beyond the three children. The reduced rate is imposed only after obtaining a certified confirmation from the VAT Commissioner.

Cyprus property Tax Rates

Immovable property tax is payable on 30 September each year and is imposed on the market value of immovable property as at 1 January 1980 and is calculated on the immovable property owned by the taxpayer on 1 January of each year. Both physical and legal persons are liable to this tax.

Value of Cyprus property



From

Up to

Rate

Accumulated Cyprus Immovable property Tax

%

0

40.000*

0,60

240

40.001

120.000

0,80

880

120.001

170.000

0,90

1.330

170.001

300.000

1,10

2.760

300.001

500.000

1,30

5.360

500.001

800.000

1,50

9.860

800.001

3.000.000

1,70

47.260

3.000.001

Over

1,90


* When the value of the property does not exceed the €12.500 no tax is imposed.

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