Key legislative and administrative changes affecting individuals and companies in Cyprus for the 2026 tax year.
Stamp duty has been abolished as from 1 January 2026. This removes the previous stamp duty liability on a wide range of documents and transactions, reducing compliance costs for both individuals and companies.
Impact: Immediate cost saving on document execution and property-related instruments.
The tax-free band has been raised to €22,000. A new 30% band now applies to income between €42,001 and €72,000, and the top rate of 35% applies to income over €72,000.
Impact: Lower effective tax rate for middle-income earners and new residents.
From 1 January 2026 the ‘not tax resident elsewhere’ condition no longer applies under the 60-day rule. Individuals can now qualify as Cyprus tax residents by staying at least 60 days in Cyprus without having to prove they are not tax resident in any other jurisdiction.
Impact: Simpler qualification for high-net-worth individuals and digital nomads.
The 5% flat rate on foreign pension income now applies on amounts over €5,000 (previously €3,420). Pensioners receiving foreign-source pension income benefit from a higher exempt threshold before the favourable flat rate is charged.
Impact: Retirees with foreign pensions keep more of their income tax-free.