Taxes and Fees When Buying Property in Cyprus – Complete Guide
Cyprus has become an increasingly popular destination for foreigners buying real estate, thanks to its low cost of living, high quality of lifestyle, favourable permanent residency policy through property acquisition, and status as one of the top retirement destinations in Europe.
One of the biggest advantages for buyers is that property taxes and purchase costs in Cyprus are significantly lower compared to other similar jurisdictions. Below is a full breakdown of the taxes and fees you should expect when buying property in Cyprus.
Stamp Duty in Cyprus
The purchaser is liable for stamp duty on the purchase price of the property at the following rates:
| Value of Property (€) | Rate (%) |
|---|---|
| Up to €5,000 | 0% |
| €5,001 – €170,000 | 0.15% |
| Over €170,000 | 0.2% |
Use our Stamp Duty Calculator to calculate stamp duties.
VAT Payable on Property
Since Cyprus joined the EU in 2004, VAT at the standard rate of 19% is payable when buying new property.
However, under the recent VAT Amendment Law, a reduced VAT rate of 5% applies when acquiring a new residential property, provided certain conditions are met:
- The property will be used as the buyer’s primary and permanent residence for the next 10 years.
- The buyer has not acquired another residence in Cyprus with a reduced VAT rate.
- The buyer is an individual over 18 years old (companies are excluded).
The reduced rate applies to the first 200 m² (according to approved architectural plans). Any area above that is subject to the standard 19% rate.
Annual Property Taxes & Fees in Cyprus
Property owners in Cyprus must pay certain annual local taxes and fees:
1. Local Authority Fees
Between €85 – €500 per year, depending on property size, for refuse collection, street lighting, sewerage, and other services. Paid to the local municipality.
2. Municipality Tax
Calculated on the property’s 2013 market value at a rate of 1‰ – 2‰. Paid annually to the local municipality.
3. Sewerage Tax
Also based on the 2013 market value, at a rate of 0.5‰ – 3‰. Paid annually to the local sewerage board.
Transfer Fees in Cyprus
Transfer fees are payable to the Cyprus Land Registry to transfer freehold ownership to the purchaser. The rates are:
| Value of Property (€) | Transfer Fee Rate (%) |
|---|---|
| Up to €85,000 | 3% |
| €85,001 – €170,000 | 5% |
| Over €170,000 | 8% |
If the property is purchased in joint names, the purchase value is split between buyers, which reduces the total transfer fee.
Example Calculation
House price: €700,000
- Individual purchase: Transfer fees €24,600 + Stamp Duty €1,308 = Total €25,908
- Joint purchase: Transfer fees €21,200 + Stamp Duty €1,308 = Total €22,508
Capital Gains Tax in Cyprus
Capital Gains Tax (CGT) of 20% is payable on profits from the sale of immovable property in Cyprus, with the first €17,086 exempt per person.
For properties bought before 1 January 1980, the gain is calculated based on the 1980 market value instead of the purchase price.
Additional allowances apply for transfer fees paid, inflation adjustments, and the cost of documented property improvements.
Sale of a private residence is exempt up to €85,430 if the owner lived in it continuously for at least five years prior to sale.
📞 Speak to a Property Lawyer Before You Sign
Ready to buy property in Cyprus? Speak to a lawyer first. We’ll help you avoid costly mistakes and make sure your investment is legally secure.
📩 Contact us now for a consultation.