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.
Cyprus Residency Planning
Sovereigns highly experienced Cyprus team are best placed to advise, and support applicants who wish to establish residency in Cyprus.
They provide a concierge service, working closely with each client to determine which programme and associated planning services are most suitable for their personal needs. Once agreed, they lead clients and their families through each step of the process, to ensure they successfully qualify, apply and process their residency application and manage their corporate and/or personal affairs in a tax efficient manner.
Cyprus Residency Programmes
Cyprus offers a range of residency programmes that cater for most personal requirements and budgets. Each provides qualifying applicants a local residence permit and the following additional benefits:
- The right to reside, settle and stay indefinitely in Cyprus
- Option to include spouse and qualifying dependent children.
- No language requirements
- Access to high quality educational institutions and medical facilities
- Use of embassies in Cyprus to apply for Schengen Visas
- Minimal ongoing physical presence or residency requirements (not applicable to the temporary permit)
- Multiple personal and corporate tax benefits
- Eligibility to apply for Cyprus citizenship by naturalisation after seven years*
* Citizenship applicants must live permanently in Cyprus for five years within a seven-year period, which amounts to 1,825 days. Additional qualification requirements also apply.
Permanent Residency Programme (PRP) – ‘Fast Track’
The Cyprus Permanent Residence Programme (PRP) provides successful applicants with permanent residence status in approximately two months. This status is valid for life and can also be passed on to dependants.
The main qualification requirements are as follow:
- Provide evidence that the main applicant has invested the minimum requirement into a qualifying investment option.
- Demonstrate proof of a secure annual income of at least €50,000, which is increased by €15,000 p.a. for each spouse and child, and by €10,000 p.a. for each dependent parent.
- A certificate of ‘no criminal record’ and of not being under investigation for criminal offences, that is attested by the relevant authorities of the applicant’s country of current residence.
- Private Medical Insurance
- Residence permit holders must visit Cyprus at least once every two years to maintain their status.
To qualify, applicants are required to make a minimum investment of €300,000 (plus VAT, if property-related) into one of the following investment options:
- Qualifying residential or commercial real estate
- A qualifying Cyprus Alternative Investment Fund (AIF)
- Shares in a Cypriot-based company employing a minimum of five local employees
A Cyprus Foreign Interest Company (FIC)
Generally, companies in the Republic of Cyprus are required to prioritise the employment of Cypriots and EU nationals before considering third-country nationals. However, Cyprus offers an exception to companies of foreign interest, allowing them to employ third-country nationals subject to specific requirements. This framework is particularly advantageous for third-country nationals who wish to incorporate their own company in Cyprus.
Qualifying Criteria
To qualify as a Cyprus Foreign Interest Company, it must:
- Be registered with the Cyprus Registrar of Companies and Intellectual Property,
- Have economic substance in Cyprus
- Have a majority of shareholders who are third country nationals
In addition to this, the ultimate beneficial owner/s (UBO) must deposit at least €200,000 in the company’s Cyprus bank account or, into the operation of its business e.g. the purchase of an office, equipment etc.
If the company has more than one UBO, the €200,000 can be deposited or invested by a single UBO or collectively.
The Key Benefits of Establishing a Cyprus Foreign Interest Company
In addition to the standard benefits available to Cyprus companies, the key benefit of an FIC is the ability to obtain residency, and work permits for its non-EU citizen Directors, Middle Management, Key Personnel and Specialists, as well as their families.
Long Term Residency Permit
The Cyprus Long term residency permit is available to those who have held a valid residency permit for a minimum of five years.
The main qualification requirements are as follow:
- Continuous Legal Residence in Cyprus for a minimum of five years.
- Annual income, sourced from outside Cyprus, of a minimum of €24,000, which increases by 20% for a spouse and by 15% for each dependent child.
- Demonstrate proficiency in the Greek Language having passed the A2 Greek language exam.
- Demonstrate knowledge of the Culture and History of Cyprus having passed the exam.
- A certificate of ‘no criminal record’ and of not being under investigation for criminal offences, that is attested by the relevant authorities.
- Private Medical Insurance
The Cyprus Long term residency permit provides holders the following benefits:
- The right to work in Cyprus
- Access to various social services, including healthcare and education.
- The permit includes family members, the spouse and children.
- After five years of continuous legal residence, individuals may apply for permanent residency
Cyprus Self-Sufficient Temporary Residence Permit
The Cyprus Temporary Residence Permit is an annually renewable self-sufficiency visa that allows an individual and their qualifying dependants, to live in Cyprus as a visitor, without employment rights.
The main qualification requirements are as follows:
- Annual income, that is sourced from outside Cyprus, of a minimum of €24,000, which increases by 20% for a spouse and by 15% for each dependent child.
- A title deed or rental agreement for a residential property in Cyprus that is for the sole use of the applicant and his/her family.
- A certificate of ‘no criminal record’ and of not being under investigation for criminal offences, that is attested by the relevant authorities of the applicant’s country of current residence.
- Private Medical Insurance
- An original medical examination certificate to confirm that the applicant does not have certain medical conditions.
N.B. It is essential that a holder of this temporary residence permit should stay out of the country for no more than three months at a time, because this could result in the permit being cancelled.
Cyprus Tax Residency Programme
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.
The main qualification requirements are as follows:
- ‘The 183-day Rule’ – For an individual to be considered a tax resident of Cyprus under standard terms, they are required to be physically present in Cyprus for more than 183 days in a calendar year.
- ‘The 60-day Rule’ – A reduced physical presence requirement applies to individuals who:
- Do not reside in any other single state for more than 183 days within a tax year.
- Are not tax resident in any other country within a tax year.
- Maintain (by owning or renting) a permanent home in Cyprus within a tax year.
- 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.
Please contact us if you have any questions or queries and your local representative will be in touch with you as soon as possible.
