Cyprus Residency Programmes
Cyprus offers a range of residency programmes that cater for most personal requirements and budgets. These provide non-EU nationals and their qualifying dependants with the right to live in Cyprus and travel throughout Europe. Successful applicants receive a Cyprus residence permit and the following benefits:
Applicants for Cyprus citizenship by naturalisation must live permanently in Cyprus for five years within a seven-year period, which amounts to 1,825 days. Additional qualification requirements also apply.
Cyprus Tax Residency Programme
The Cyprus Tax Residency programme provides preferential tax incentives for qualifying non-domiciled individuals who are resident in Cyprus. The main qualification requirements are as follows:
- The ‘183-day Rule’ – under the Cyprus Income tax Law, an individual is considered tax resident in Cyprus if they are physically present in Cyprus for more than 183 days in a tax year (1 January to 31 December) .
- In cases where the ‘183-day Rule’ does not apply, an individual can also be considered tax resident in Cyprus if they are resident for only 60 days in a given tax year (the ’60-day Rule’), provided they can satisfy all the following conditions:
- They do not reside in any other single country for more than 183 days within a tax year.
- They maintain (either owning or renting) a permanent home in Cyprus within a tax year.
They establish a business and/or are employed in Cyprus and/or hold an office with a Cyprus tax resident company at any time during the tax year.
Cyprus Non-Domicile Tax Regime
Cyprus introduced a ‘non-domicile’ regime for Cyprus tax resident individuals in 2016 tax year, which provides significant tax efficiencies and benefits to those individuals making use of it, alongside the rules governing tax residency.
An individual who is a tax resident of Cyprus under the provisions of the Income Tax Law (either under the ‘183 day’ rule or the ‘60 day’ rule) but is not domiciled in Cyprus because he or she has a domicile of origin or a domicile of choice outside Cyprus will be exempt from the Special Defence Contribution (SDC), which applies tax at the rate of 17% to dividends and interest income regardless of its country of source.
The exclusion from SDC for non-domiciled Cyprus tax resident individuals ceases to apply once the individual had been tax resident in Cyprus for at least 17 out of the last 20 tax years prior to the tax year under assessment, at which point they are regarded as ‘deemed domiciled’ in Cyprus.
Under the Cyprus Tax Reform Package 2026, an alternative tax option was introduced for such individuals, permitting continuation of the SDC exemption for two consecutive five-year periods subject to a lump-sum payment of €250,000 per period.
The SDC tax previously imposed on rental income was also abolished, leaving rental income taxable solely under income tax rules.
Special Tax Regime on Foreign Pension Income
Cyprus has long been regarded as a premier retirement destination, renowned for its excellent climate, appealing lifestyle, safety and low taxes on pension income. Tax residency in Cyprus has many benefits and exemptions for non-nationals, especially retirees.
One of the key advantages of obtaining a Category 5 Permanent Residency Permit (PRP or Fast Track PRP) is the low tax rates on pension income that apply to individuals retiring in Cyprus.
A foreign pension received in Cyprus can be taxed either at the standard personal income tax rates in Cyprus, of which the first €22,000 of earned annual income is tax-free, or at a special 5% flat rate for any amounts exceeding €5,000 per year. Cyprus tax residents receiving pension income from abroad can continue to elect annually between taxation under the normal progressive income tax rates or the 5% flat rate tax.
Available to both non-EU and EU nationals, the Cyprus tax residency programme provides preferential tax incentives for qualifying, non-domiciled individuals who establish residency in Cyprus.
Establishing 'Citizenship through Naturalisation' in Cyprus
To streamline the citizenship process and enhance safeguards, the Cypriot government revised the criteria for obtaining Cypriot citizenship though naturalisation by passing amendments to the Civil Registry Laws in December 2023.
Generally, applicants for citizenship though naturalisation must have a minimum of seven years of legal residence in Cyprus within the 10 years preceding the application. There must also have been a continuous legal stay of 12 months immediately prior to the submission of the application, although absences of up to 90 days within this 12-month period do not disrupt continuity.
Applicants are further required to show that they are a person of good character, have Greek language proficiency, have knowledge of contemporary political and social reality, have suitable accommodation and financial stability, and have a genuine intention to live in the Republic of Cyprus.
Highly Skilled Employees
To recognise the economic value of skilled professionals, special provisions were made to the criteria for obtaining Cypriot citizenship though naturalisation to reduce the qualifying residency period from seven to four or three years for ‘highly skilled employees’ of specific classifications of companies – including companies of ‘foreign interests’ or companies operating in the shipping, pharmaceuticals, biotechnology, technology and innovation sectors.
Highly skilled employees are regarded as individuals who, in addition to being employed by an eligible company, fulfil one of the following criteria:
- Hold a temporary residence permit and are employed as ‘Director’, ‘Specialist’ or ‘Key Personnel’.
- Hold any type of immigration status in Cyprus, are employed in a position relevant to their academic/professional qualifications and previous experience and receive a minimum monthly gross salary of €2,500.
For qualifying highly skilled employees the applicable periods of legal residence in Cyprus within the 10 years preceding the application are reduced to:
- Three years for B1 Greek language certificate holders.
- Four years for A2 Greek language certificate holders.
Spouses and civil partners of highly skilled employees can apply under the same conditions, either simultaneously with their spouse or at a later stage. Children, who at the time of the submission of the highly skilled employee’s application were underage, are eligible to apply as minors, even if they will reach adulthood by the time the highly skilled employee is naturalised as a Cypriot citizen.
An expedited processing option is available, which ensures that applications are processed within eight months from the date of submission, subject to the payment of a €5,000 government fee.
Please contact us if you have any questions or queries and your local representative will be in touch with you as soon as possible.
