Cyprus Work Permit & Tax Residency for Employees
Employment & Residency Permits
Cyprus has emerged as a prime destination for skilled professionals seeking EU opportunities. With its strategic location, English-speaking business environment, and competitive tax regime, the island attracts talent across technology, finance, shipping, and professional services.
Non-EU nationals have several pathways to work authorization. Standard employment permits suit professionals with a job offer from a Cyprus-registered company. The EU Blue Card—available since July 2025—targets highly qualified professionals in strategic sectors (ICT, pharma research, shipping), requiring a minimum €43,632 annual salary. Blue Card holders enjoy fast-track processing, family reunification, spouse work rights, and eligibility for EU long-term resident status after 33 months.
From employment to citizenship, Cyprus offers a defined route. Highly skilled workers qualify for naturalization after four years with B1 Greek, or five years with A2 Greek. Other third-country nationals require eight years of residence. The final year before application must include 12 consecutive months in Cyprus (90-day absences permitted).
Tax Benefits for Employees
50% Tax Deduction
Employees with annual remuneration over €55,000 who were not Cyprus residents before employment benefit from a 50% tax exemption on their salary for 17 years.
Alternative 20% Exemption
For employees earning less than €55,000 annually (who do not qualify for the 50% exemption), a 20% exemption (up to €8,550) is available for 7 years from the start of employment.
€22,000 Tax-Free Threshold
Income up to €22,000 is completely tax-free in Cyprus, one of the highest thresholds in Europe.
Dividend Exemption
Dividends received are fully exempt from income tax. With Non-Dom status, also exempt from Special Defense Contribution.
No Capital Gains Tax
Profits from sale of shares and securities are completely exempt. No capital gains on property located outside Cyprus.
Non-Dom Status
Automatically granted to foreigners for up to 17 years, exempting you from SDC on dividends, interest, and rental income.
Personal Income Tax Rates
Cyprus has a progressive income tax system with competitive rates. The 50% deduction column shows tax payable on €100,000 income with the 50% exemption for new residents earning over €55,000:
| Yearly Income | Tax Rate | Tax Amount | With 50% Deduction |
|---|---|---|---|
| €0 - €22,000 | 0% | Zero | Zero |
| €22,001 - €30,000 | 20% | €1,600 | €1,600 |
| €30,001 - €40,000 | 25% | €4,100 | €4,100 |
| €40,001 - €80,000 | 30% | €16,100 | €7,100 |
| Over €80,000 | 35% | - | €7,100 total |
Becoming a Cyprus Tax Resident
An individual can become a Cyprus Tax Resident under the 183-day or 60-day rule:
183-Day Rule
Spend more than 183 days in Cyprus during a calendar year to qualify as a tax resident.
60-Day Rule
A more flexible option for those who do not reside in any other country for more than 183 days, are not tax resident elsewhere, and have Cyprus ties (employment contract, directorship, or business ownership).
Key Tax Exemptions for Individuals
- Dividends - Fully exempt from income tax
- Profits from sale of securities - Fully exempt
- Income from employment abroad for 90+ days - Fully exempt
- Lump sum retirement payments - Fully exempt
- Profits of foreign permanent establishments - Fully exempt under conditions
Tax Deductions Available
- Donations to approved charities - Fully deductible
- Trade union and professional body contributions - Fully deductible
- Rental property expenses - 20% of rental income
- Social insurance, medical fund, pension contributions - Up to 1/5 of taxable income
- Current and prior year losses - Fully deductible
Required Documentation
Timeline: The tax residency registration process typically takes 10-15 working days to complete.
- Valid passport copy
- Bank statement (6 months) as proof of sufficient funds
- Proof of source of income
- Tax department registration forms
- Health insurance coverage
- Rental agreement or property ownership proof
- Residency permit (Yellow slip for EU nationals, Pink slip for non-EU)
How We Can Help You
Eligibility Review
Assessment of your qualifications, employment offer, and salary against permit requirements including EU Blue Card thresholds.
Employer Coordination
Working with your employer on Foreign Interest Company registration and ensuring all corporate prerequisites are in place.
Permit Application
Preparation and submission of work permit and temporary residence applications with all required supporting documentation.
Tax Registration
Personal tax number (TIC) registration, social insurance enrollment, and guidance on the 50% tax exemption eligibility.
Family Reunification
Dependent visa applications for spouse and children, including school enrollment assistance and healthcare registration.
Settlement Services
Bank account opening, rental search, utility connections, and practical guidance for your first months in Cyprus.
Start Your Journey
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