English (United Kingdom)

The Cyprus Parliament has voted further amendments to the Income Tax Law (ITL) in relation to the provisions of Article 8(23A).

The amendments made to Article 8(23A) were published in the Cyprus Gazete on 30 June 2023 and are applicable retroactively from 1 January 2022 the following:

  • The 50% exemption on income tax is granted to individuals who were not residents of Cyprus for 15 consecutive years (instead of 10 years as was previously the case) prior to any employment in Cyprus.  Under these circumstances, an individual is considered to have commenced first employment in Cyprus when for the first time (after a period of 15 consecutive years during which he was outside of the Republic and was not performing any salaried services in Cyprus) commences his employment in Cyprus to an employer resident in Cyprus or to a non-Cyprus resident employer. 
  • The 50% exemption on income tax is granted to individuals, who meet the conditions for the exemption, even if they change employer - the exemption was previously only granted for the first employment in Cyprus whereas change of employer resulted to termination of the exemption.
  • The 50% exemption on income tax is granted for 17 consecutive years starting from the tax year of employment in the Republic (or until the provisions of Article 8(23A) are abolished, whichever occurs earlier) .

Ιt is noteworthy that the above amendments apply to the transitional provisions as these were initially introduced in Article 8(23A), and are as follows:
Individuals whose employment commenced before 1 January 2022 and who were not Cyprus tax residents during any of the 15 years preceding the year of their employment in Cyprus, may also be eligible to transition into the provisions of new Article 8(23A) for the 50% exemption during any tax year in which their remuneration exceeds the amount of €55.000, starting from year 2022 and until the completion of 17 consecutive years from the year of their employment, provided they meet one of the following conditions:

  • The individuals were eligible for 50% exemption under the provisions of Article 8(23) of the Income Tax Law; or
  • The individuals were first employed in Cyprus during the period 2016-2021 with remuneration exceeding the amount of €55.000 per annum; or
  • The individuals’ first employment in Cyprus commenced during the period 2016-2021 with remuneration not exceeding the amount of €55.000 per annum, and within 6 months from the date of publication of the new Law in the Cyprus Government Gazette (26 July 2022), their remuneration exceeded the amount of €55.000.

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