Cyprus Property Tax for Owners and Landlords: The 2026 Guide

1The four tax moments — a map before the detail

A useful way to think about Cyprus property tax is not as one thing but as four distinct moments: buy, hold, earn, sell. Each has its own rules and its own bill. The 2026 reform changed two of them substantially.

2Buying — transfer fees, VAT, and the stamp duty that no longer exists

When you buy a property in Cyprus, you'll pay either transfer fees or VAT, not both. Which one depends on whether the property is a resale or a new build. Resale properties pay transfer fees on a tiered scale, calculated on market value as assessed by the Department of Lands and Surveys. The 50% discount shown below applies because there is no VAT on most resales — a €250,000 resale apartment incurs roughly €4,025 in transfer fees, not €8,050. New builds are different: VAT is paid on the purchase price (19% standard, with a 5% reduced rate possible for a qualifying primary residence — see below). Where VAT is paid, transfer fees are fully exempt. The 2026 reform also abolished stamp duty on property transactions from 1 January 2026. Budget separately for legal fees (typically 1–1.5% plus VAT), a Land Registry search, and immovable property transfer registration costs.

3Holding — the bill that almost isn't there

This is where Cyprus genuinely stands apart from most of Europe. There is no national annual property tax. The Immovable Property Tax was abolished in 2017 and the 2026 reform left that decision firmly in place. What you do pay is local: municipal taxes (broadly 0.1%–0.2% of market value) and sewerage and refuse charges (broadly 0.3%–0.35%). For a typical Paphos villa or apartment, the combined annual bill from the municipality and the sewerage board lands somewhere between €90 and €300 per year, depending on the municipality and the property's assessed value.

4Earning — the 2026 landlord tax stack

If you let your Cyprus property, three layers used to apply: personal income tax, Special Defence Contribution (SDC) on rents, and the GeSY healthcare contribution. From 1 January 2026, SDC on rental income was abolished. That removes an effective 2.25% of gross rent from the landlord's bill — a clean win, and the most material 2026 change for owners with property already on the rental market. What remains is personal income tax and GeSY. Two important reliefs apply to long-let landlords:

• •20% deemed expense deduction — only 80% of gross rent is taxable. You don't need to itemise; the deduction is automatic.
• •Mortgage interest and capital allowances on the building (3% of cost) are deductible if you choose to itemise rather than take the deemed 20%.

5Selling — Capital Gains Tax and the bigger lifetime exemptions

Capital Gains Tax in Cyprus is a flat 20% on the gain (sale price minus indexed acquisition cost minus allowable expenses such as legal fees, transfer fees, and capital improvements). The rate hasn't changed for 2026 — but the lifetime exemptions a seller can deduct from the gain have risen sharply. These are lifetime allowances, not annual ones — once used, they don't reset. They apply only to disposals completed on or after 1 January 2026; if you signed a contract before 2026, the older thresholds apply. Disposals of shares in companies whose value derives from Cyprus immovable property remain inside the CGT net. If you intend to keep the property in the family long-term, the lifetime nature of the exemption is what matters: the higher €150,000 cap on a primary residence sale is genuinely powerful planning room.

6A worked picture — what a typical Paphos landlord actually pays

Numbers help. Imagine a Paphos owner with a two-bed apartment on long let earning €18,000 gross per year, with no other Cyprus-source income. The 2026 tax stack looks roughly like this: • Taxable rental income: €18,000 × 80% = €14,400. • Personal income tax: €14,400 falls below the €22,000 0% band → €0 income tax. • GeSY: 2.65% × €18,000 = €477. • Local authority charges: ~€150 (illustrative). • SDC on rent: €0 (abolished). Total Cyprus tax bill on the rental activity: roughly €627 a year, or about 3.5% of gross. The picture changes once rent — or other income — pushes above the €22,000 threshold, and short-let activity adds 9% VAT. The framework is the same; the numbers shift. These are illustrative figures, not advice. Your situation will differ if you have other Cyprus income, hold the property through a company, or claim allowable deductions other than the 20% deemed expense.

7Where this fits with residency and your wider position

Tax on Cyprus property doesn't sit on its own. For many of the owners we work with at Spitiko, it's part of a wider move: relocating tax residency, taking advantage of the non-dom regime, or securing permanent residency through the property itself. The 2026 reform raised the 0% income tax band to €22,000 and reduced the standard withholding on dividends — both of which interact with how you choose to hold the property and how you structure the income coming out of it.