Tax incentives –  up to 50% tax exemption on remuneration from employment in Cyprus

In the 26th of July 2022 Cyprus amended the Income Tax Law and introduced tax exemptions of 50% or 20% on remuneration for individuals relocating to take up employment in Cyprus.

This new scheme has been introduced as facilitating the headquartering of foreign businesses to Cyprus and the relocation of talented, high-skilled employees and their families to Cyprus,

The tax exemptions for taking up employment in Cyprus is 50% or 20% on the remuneration based on certain criteria:

• 50% tax exemption on remuneration for the first employment in Cyprus for an individual that:
  • was resident outside Cyprus for ten consecutive years prior to taking up employment in Cyprus
  • was employed in Cyprus after 1^st of January 2022
  • the remunerations from employment exceeds EUR 55,000 each tax year.

The tax exemption is granted for a period of 17 years.

• 20% tax exemption, or EUR 8,550, whichever is the lower, for remuneration for the first employment in Cyprus for an individual that:
  • was resident outside Cyprus for three consecutive years prior to taking up employment in Cyprus
  • was employed in Cyprus after 26^th of July 2022 and before the 31^st of December 2027.

The tax exemption is granted for a period of 7 years.