VAT in Cyprus: Complete 2026 Guide

It depends on where your client is. For EU B2B clients (with a VAT number), reverse charge applies — you issue a 0% VAT invoice. For non-EU clients, services are generally outside the scope of Cyprus VAT entirely — no VAT charged. For EU consumers, you charge VAT at their country's rate via OSS if you exceed EUR 10,000 in cross-border B2C sales.

EUR 15,600 in taxable turnover over any 12-month period. If you exceed this — or reasonably expect to — you must register for VAT within 30 days. Voluntary registration below this threshold is also possible and can be beneficial if you have significant VAT costs to reclaim.

Yes, if you are VAT-registered you can reclaim input VAT on goods and services purchased for business purposes, provided your business makes taxable supplies. This includes office equipment, professional services, software subscriptions, and similar costs. VAT on purely exempt supplies (e.g., residential rent income) cannot be reclaimed.

The One Stop Shop (OSS) scheme lets you register once in Cyprus and file a single VAT return covering your sales to consumers across all EU countries. You charge each customer the VAT rate of their country, report it in your OSS return, and pay the total to Cyprus Tax Department, which then distributes it to each member state. This avoids needing separate VAT registrations across the EU.

The rules on who VAT is due to and at what rate are the same — both follow the destination principle for B2C sales within the EU. However, digital services (software, streaming, e-books) have always been subject to destination-country VAT for B2C transactions with no minimum threshold — so OSS is almost always required if you sell digital services to EU consumers.

The standard VAT rate in Cyprus is 19%. Reduced rates of 9% (hospitality, transport) and 5% (books, medicines, residential construction) also apply to specific categories.

VAT registration is mandatory once your annual taxable turnover exceeds €15,600. Voluntary registration is possible below this threshold.

Yes, if your annual turnover from freelance services exceeds €15,600. If you work primarily with non-EU clients, the place of supply rules may mean your services are outside the scope of Cyprus VAT, but registration is still required above the threshold for domestic supplies.

Quarterly. VAT returns are due by the last working day of the month following the end of each quarter. For example, the Q1 return (January to March) is due by April 30.

Yes. If your input VAT exceeds your output VAT in a period, you can claim a refund from the Cyprus Tax Department. Refunds are processed within 30 days for standard claims.

Residential rent is generally exempt from VAT. Commercial property leases may be subject to VAT if the landlord has opted to charge it, but many commercial leases are exempt.

Cyprus VAT numbers follow the format CY########L — two letters CY, eight digits, and a final letter.