Other taxes | Cyprus Developers Alliance

Lump-sum (one-time) payments associated with immovable property acquisition

Transfer Fee

The Legal Issues section explains that a buyer becomes a registered immovable property owner after the Government’s execution of Title Deed for the purchased property and its transfer onto the buyer’s name. 

This process is accompanied by the payment of Transfer Fee - a government tax. Transfer Fee which is being charged stands for a contract value of the property (excluding VAT).

Tax rates are demonstrated below: 

Transfer Fee is not charged on a property which is subject to VAT (in other words for a new property). The tax is being charged only for purchase of a re-sale property. 

Let’s consider this example: one has purchased a property worth €500.000. The transfer fee one has to pay shall be calculated the following way:

85.000*1,5% + 85.000*2,5% + 330.000*4% = €16.600 

How does one save money? Individuals could register the purchase onto two buyers. According to the contract, each pays €250.000. In this case, the calculation shall be the following:

(85.000*1,5% + 85.000*2,5% + 80.000*4%)*2 = €13.200

If the purchase is acquired by several individuals, they can save even more.

Also, there is an option of optimizing this tax by transferring the cost of some works and materials outside the framework of the basic sales agreement, formalising them as additional works "extras". 

One should bear in mind that it is necessary not to abuse this opportunity, as for calculating the Transfer Fee, the Land District Office takes into account not only the contract value of one’s property, but also the price  of similar properties sold in the same area, around the same time. They may disagree with one’s proposed figures, if they notice that the price of one’s property is clearly understated compared to similar properties.

Stamp duties

Since 2026, the stamp duties tax has been completely abolished.

Lump-sum (one-time) payments associated with immovable property sale or transfer

Capital Gains Tax

If you decide to sell your property in Cyprus, you pay Capital Gains Tax at a rate of 20% on the gain received (the difference between the sale and purchase price). It's important to note that the actual tax rate is significantly lower, as Cyprus law provides significant tax incentives. Here are some of them:

• The first €30,000 of capital gains are exempt from tax for each owner.
• If the seller has owned the property for at least five years and is selling their first Cyprus property, the first €150,000 of capital gains are exempt from tax.
• Demonstrated capital expenditures, such as repairs, other material costs, etc., are excluded from the taxable base.
• Real estate agent commissions for the sale and legal fees for the sale of the property are also excluded.
• When calculating the tax, the property's initial value is adjusted in line with the inflation index.
• Taxes paid at the time of purchase of the property (Transfer Fee and VAT) reduce the taxable base of Capital Gains Tax.
• If the seller acquired the property with a mortgage, the interest on the mortgage reduces the taxable base.

If the property is sold together with movable property (furniture, appliances), the latter can be transferred under a separate agreement at its own cost. This will reduce the value of the property itself, leading to a reduction in Capital Gains Tax.

Inheritance Tax

Properties in Cyprus are exempt from inheritance tax.

Payments related to property ownership

Since 2017, the annual immovable property tax has been completely abolished.