Quick Answer

Cyprus abolished the Immovable Property Tax (IPT) in 2017. Current property-related taxes include a municipal levy of 0.1-0.3% on property value and transfer fees on purchase. Capital gains from property disposal are taxed at 20%, with a lifetime exemption of EUR 85,430 for a primary residence. There is no annual wealth tax or mansion tax.

Key Facts 2026

Immovable Property Tax (IPT)0% - abolished on 1 January 2017
Annual municipal levy0.1-0.35% of official value (municipality-dependent)
Capital gains on Cyprus property20% of gain (after indexation and exemptions)
Capital gains on overseas property0%
Property transfer fees (purchase)3% up to EUR 85,430 / 5% above (halved for new builds before June 2016 exemption expiry)
Stamp duty (on purchase contracts)0.15% up to EUR 170,860 / 0.2% above
Primary residence CGT lifetime exemptionEUR 85,430

Property Tax in Cyprus: What Owners Actually Pay in 2026

Cyprus abolished the annual immovable property tax in 2017. Today, property owners pay transfer fees when buying, and 20% CGT if they sell at a profit.

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Property Tax in Cyprus — FAQ

Is there an annual property tax (like IBI in Spain) in Cyprus?
No. Cyprus abolished the Immovable Property Tax (IPT) in 2017. There is no recurring annual tax on the value of property you own. You will pay local municipal charges (sewerage, refuse collection, municipality levy), but these are service fees — typically EUR 200–500 per year depending on the municipality.
What are the total closing costs when buying property in Cyprus?
Typical closing costs when buying property in Cyprus include: Transfer fees (3–8% or 1.5–4% with VAT discount), legal fees (0.5–1% of purchase price), land registry fees for searches and caveat registration (a few hundred EUR). Stamp duty was abolished in January 2024 — it no longer applies. No mortgage registration tax applies to standard residential mortgages.
Is stamp duty still charged in Cyprus?
No. Stamp duty on property transactions and contracts was abolished with effect from 1 January 2024. Before 2024, stamp duty was applied at 0.15% on the first EUR 170,860 and 0.2% on amounts above that. The abolition significantly reduced the cost of property transactions.
Does Cyprus have inheritance tax on property?
No. Cyprus abolished estate duty (inheritance tax) in 2000. There is no inheritance tax or estate duty on property passed between family members or anyone else. Assets pass without inheritance tax liability, making Cyprus very attractive for estate planning.
Can I deduct mortgage interest from rental income?
Yes. Interest on loans used to acquire a property that produces rental income is deductible from that rental income for income tax purposes. You can also deduct wear and tear allowances (typically 3% per year for residential properties) and maintenance costs directly related to the property.
What happens when I sell a property held in a company?
If you sell shares in a company that owns Cyprus property, this may attract Cyprus CGT at 20% if the company's assets consist mainly of Cyprus immovable property. However, selling a company that holds primarily other assets (not Cyprus land/buildings) is exempt from CGT. Structuring advice from a Cyprus tax lawyer is important before any sale.

Frequently Asked Questions

Is there a property tax in Cyprus?
No annual immovable property tax since 2017. Property owners pay local municipality rates of €50 to €300 per year at most. Transfer fees and CGT apply only when buying or selling.
What are the transfer fees when buying property in Cyprus?
3% on value up to €85,000, 5% on €85,001–€170,000, and 8% above €170,000. If VAT was charged on the purchase, transfer fees are halved.
Do I pay CGT when selling property in Cyprus?
Yes, 20% on the net gain from the sale of Cyprus property. Lifetime exemptions of €17,086 to €85,430 apply depending on circumstances. Foreign property gains are not subject to Cyprus CGT.
What VAT applies to new property in Cyprus?
19% standard VAT on new residential property from developers. 5% reduced rate for the first 200sqm of a primary residence for first-time buyers.
Is rental income taxed in Cyprus?
Yes, as ordinary income at progressive rates (0%–35%) after a 20% expense deduction. No SDC applies from 2026. GHS contributions (2.65%) apply on rental income.
Can foreigners own property in Cyprus?
EU citizens can buy property in Cyprus freely. Non-EU nationals may purchase up to one residential or commercial property as individuals (additional properties require Council of Ministers approval, though this is routinely granted). Investors who purchase €300,000+ in qualifying property qualify for permanent residency.

Related Guides

Sources

Cyprus Land Registry Department. Immovable Property Tax Abolition Law 2017. Capital Gains Tax Law (Cap. 344). Updated: April 2026.

Frequently Asked Questions

Is stamp duty still payable in Cyprus in 2026?

No. Stamp duty on contracts and documents was abolished in Cyprus effective 1 January 2026 as part of the 2026 tax reform. Previously, stamp duty applied to contracts at 0.15% up to EUR 170,860 or 0.2% above EUR 170,860, capped at EUR 20,000.

From 2026 onwards, no stamp duty is payable on any contract or instrument in Cyprus. This includes property sale agreements, loan agreements, company formation documents, and employment contracts.

Was immovable property tax abolished in Cyprus?

Yes. The annual immovable property tax (IPT) levied by the central government was abolished in Cyprus in 2017. This was a recurring annual tax on the value of land and buildings owned in Cyprus.

Today, property owners in Cyprus pay only: municipal rates (refuse collection and streetlighting - small fixed annual amounts set by each municipality), transfer tax on purchase (up to 8% of property value, paid once), and VAT on new builds (19% standard, or reduced 5% for a primary residence up to 200 square metres). There is no annual state property tax.

What is the 0.4% levy on property sales in Cyprus?
Since February 2021, all disposals of immovable property in Cyprus are subject to a 0.4% levy on the sale proceeds. This applies to both direct property sales and to sales of shares in "property-rich" companies — those where Cyprus immovable property represents more than 20% of asset value (threshold tightened in 2026 from the previous 50%). The levy is paid by the seller and its purpose is to fund compensation for Cypriot refugees displaced by the 1974 Turkish military occupation. It is separate from Capital Gains Tax (20% on gains) and transfer fees, and is payable on the full disposal consideration, not just the profit.

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