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Moving to Cyprus: tax residency, non-dom and the 2026 rules
General information, not tax advice. Residency, domicile and the employment exemptions all have detailed conditions. Always check your own situation with a licensed professional before you move or plan around these rules.
1. Becoming a Cyprus tax resident
Cyprus tax residents are taxed on their worldwide income. Non-residents are taxed only on certain Cyprus-source income. The tax year is the calendar year. You are resident if you meet either of these tests:
The 183-day rule
You spend more than 183 days in total in Cyprus in the tax year. No other conditions apply.
The 60-day rule
You meet all of these in the same tax year:
- You spend at least 60 days in Cyprus.
- You do not spend more than 183 days in any other single country.
- You carry on a business in Cyprus, are employed in Cyprus, or hold an office (for example, director) in a Cyprus tax resident company at any time in the year, and this is not ended during the year.
- You keep a permanent home in Cyprus that you own or rent.
Changed in 2026: the old condition that you are "not tax resident in any other country" was removed from 1 January 2026. If another country also claims you as resident, the double tax treaty between the two countries decides where you are resident.
Counting days: the day you arrive counts as a day in Cyprus, the day you leave counts as a day outside Cyprus. Arriving and leaving on the same day counts as a day in Cyprus; leaving and coming back on the same day counts as a day outside.
2. Non-dom status (Special Defence Contribution exemption)
- Special Defence Contribution (SDC) is a separate tax on dividends and interest (and on rent up to the end of 2025). It is charged only on people who are both Cyprus tax resident and Cyprus domiciled.
- If you are tax resident but not domiciled in Cyprus ("non-dom"), you pay no SDC on dividends, interest or rent. Dividends and most interest are also exempt from income tax, so in practice they are not taxed in Cyprus apart from the GHS contribution (see section 4).
- For domiciled residents, SDC on dividends is 5% on profits from 2026 onwards (17% on older profits), and 17% on most interest.
- Domicile usually follows your domicile of origin (normally your father's at birth). Whatever your origin, you are deemed domiciled once you have been Cyprus tax resident for at least 17 of the last 20 years.
- New from 2026: if you have no Cyprus domicile of origin and become deemed domiciled under the 17-of-20 rule, you can elect an alternative method: pay €250,000 for each five-year period, for up to two periods (10 years), and be treated as non-domiciled for SDC. The election is made on form T.D.631 by 30 June of the first year of the period, needs the Tax Commissioner's approval, and the payment is not refundable (Circular 2/2026).
- To claim non-dom treatment you file form T.D.38 with the Tax Department.
3. Personal income tax from 2026
The 2026 tax reform raised the tax-free amount from €19,500 to €22,000 and widened the bands, from 1 January 2026:
| Chargeable income | Rate | Tax on the band |
|---|
| €0 – €22,000 | 0% | €0 |
| €22,001 – €32,000 | 20% | €2,000 |
| €32,001 – €42,000 | 25% | €2,500 |
| €42,001 – €72,000 | 30% | €9,000 |
| Over €72,000 | 35% | – |
- Other reform changes for individuals include new deductions (subject to family income limits) for each child, for rent or mortgage interest on your main home (up to €2,000), and for energy upgrades or an electric vehicle (up to €1,000).
- Foreign pensions are taxed at 5% on amounts above €5,000 (you can choose the normal bands instead).
- Crypto gains are taxed separately at a flat 8%. See our crypto tax guide.
- Try our Cyprus income tax calculator 2026 for a quick estimate.
4. Exemptions on employment income for new residents
50% exemption
- 50% of your employment income is exempt from income tax.
- It is for your first employment in Cyprus, where you were not Cyprus resident for at least 15 consecutive tax years before it started (and did not work in Cyprus in that period).
- Your pay must be over €55,000 a year.
- It lasts up to 17 years and can be used once in a lifetime. Slightly different rules apply to jobs that started before 1 July 2023.
20% exemption
- 20% of your employment income is exempt, up to €8,550 a year.
- It is for a first employment in Cyprus that started after 26 July 2022, where you were not Cyprus resident for at least 3 consecutive tax years before, and you were employed outside Cyprus by a non-resident employer just before.
- It lasts 7 years, starting from the tax year after the job starts. You cannot claim it if you get the 50% exemption.
A separate 25% exemption (up to €25,000 a year) exists for people who were Cyprus residents in the past and return after at least seven years away, for jobs or businesses started from 2025 to 2030. Conditions apply.
5. GHS and social insurance
- GHS (General Health System, GeSY): employees pay 2.65% of their pay. Rental, interest and dividend income is also charged at 2.65%. Contributions are capped at €180,000 of income a year. Non-residents pay only on Cyprus income, excluding dividends and interest.
- Social insurance: employees pay 8.8% of pay, up to a ceiling of €68,904 for 2026. Employers pay 8.8% too, plus other funds. Self-employed people pay 16.6%.
6. Practical steps
- Get a tax number (TIN): create an account on the Tax Department's Tax For All (TFA) portal and choose "Register as a new taxpayer", attaching your ID documents. Registration is online only; the old paper form T.D.2001 is no longer accepted.
- File a tax return every year: from tax year 2026, Cyprus tax residents aged 25 to 70 must file a return even with no taxable income, as must anyone with income covered by the law. Employees file by 31 July of the following year.
- Claim non-dom status on form T.D.38 if it applies to you.
- Tell your employer about any 50% or 20% exemption you qualify for.
- Keep evidence of your days in Cyprus and abroad, your Cyprus home (title deed or rental contract) and your Cyprus job or business, in case you need a tax residency certificate.
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Related guides
See also our guide to setting up a Cyprus company, the Cyprus income tax calculator 2026, Cyprus property taxes 2026 and Cyprus crypto taxes 2026, or go back to the Cyprus Tax Connect homepage.
Sources
Last reviewed 18 October 2026.