Criteria for Individuals to be considered as Cyprus Tax Residents

According to Section 2 of the Income Tax Law, an individual is resident in Cyprus, if he/she resides therein for a period or more which in aggregate exceed 183 days in a tax year. A tax year commences 1 January and ends 31 December.

In order to calculate the period of residence in Cyprus for tax purposes 

  • the day of departure from Cyprus counts as a day of residence outside Cyprus
  • the day of arrival in Cyprus counts as a day of residence in Cyprus
  • arrival and departure from Cyprus on the same day counts as one day of residence in Cyprus
  • departure and arrival in Cyprus on the same day counts as one day of residence outside Cyprus

On 14 July 2017, the Cyprus Parliament approved the law amending Section 2 of the Income Tax Law retroactively as of 1 January 2017. Under the amended law an individual is considered as a tax resident of Cyprus if the individual satisfies either the “183 day rule” or the “60 day rule” for the tax year.

The amended “60 day rule” for Cyprus tax residency applies to individuals who in the relevant tax year:

  • reside in Cyprus for at least 60 days, and 
  • do not reside in any other single state for a period exceeding 183 days in aggregate, and 
  • are not tax resident in any other state, and
  • have other defined Cyprus ties. (See below)

To satisfy “other defined Cyprus ties” the individual must:

  • carry out any business in Cyprus and/or be employed in Cyprus and/or
  • hold an office (director) of a company tax resident in Cyprus at any time in the tax year, provided that such is not terminated during the tax year.
  • maintain in the tax year a permanent residential property in Cyprus which is either owned or rented by the individual.

The law is further amended to clarify that an individual that cumulatively meets all the above conditions shall not be treated as a Cyprus tax resident in the tax year if, during that year the exercise of any kind of business in the Republic and/or employment in the Republic and/or holding of an office with a tax resident person in the Republic is terminated.

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