Cyprus Capital Gains Tax

Profit from the sale of property in Cyprus is subject to Capital Gains Tax (CGT) at the rate of 20%.

Exemptions: in the following examples CGT does not apply:

  • Transfer arising from death of title owner
  • Exchange or sale of property under the Agricultural Land Laws
  • Gifts;
    • Made between close relatives (up to 3rd degree relatives)
    • To a company where the company’s shareholders are members of the donor’s family (shareholders should continue to remain family members for not less than 5 years)
    • By a family company to its shareholders provided such property was originally acquired by the company by way of donation (the recipient must keep the property for not less than 3 years)
    • To charities and the Government

NOTE: However; CGT applies to profits from the sale of shares in companies which own property in Cyprus, unless the company is listed on the stock exchange.

CGT is calculated only on gains made after 1st January 1980.  There are two options to calculate it;

Option 1:

Gross proceeds of sale
Market value as of 1/1/1980
Cost of sale (transfer fees, legal fees etc)
= Amount to be considered for CGT
x 20%
= Amount of CGT to pay

Option 2:

Gross proceeds of sale
Cost of acquisition and improvements made after 1 January 1980 and adjusted for inflation up to the date of the sale based on the Cyprus consumer price index
Cost of sale (transfer fees, legal fees etc)
= Amount to be considered for CGT
X 20%
= Amount of CGT to pay