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Writer's pictureL. Gnaftis & Co

The '60 Day Rule' Explained

As from January 2017, a new rule related to the Tax Residency(183 days rule) has been introduced by the Republic of Cyprus in order to benefit individuals who are in the process of becoming Cyprus Tax Residents but cannot follow the ‘183 days rule’.



An individual who does not stay in any other country, for a period of more than 183 days of the same tax year and is also not a tax resident of any country in that year, can become a Cyprus tax resident , if all the following conditions apply:

  • The individual stays in Cyprus for at least 60 days in that tax year

  • The individual is employed in Cyprus and/or exercises a business in Cyprus, holds an office and is a director of a Cyprus tax resident company at any time during the tax year

  • The individual owns or leases a permanent home in Cyprus.

Amendments in the law state, that in the case of exercise of business/employment in Cyprus /holding an office/being a director, termination in the tax year, the tax resident person shall not be treated as a Cyprus tax resident during the specific year.


Calculating the days spent in Cyprus:

  • Day of arrival in the Republic of Cyprus is counted to be a day in the Republic of Cyprus

  • However, the day of departure from the Republic of Cyprus cannot be counted as a day in the Republic of Cyprus.

  • Arrival and departure in the same day, is counted as a day in the Republic of Cyprus.

  • Departure and arrival in the Republic, in the same day, cannot be counted as a day in the Republic of Cyprus.

In relation with the Cyprus tax law, an individual who is a tax resident of Cyprus (under the 183 days rule or the 60 day rule) and is non-domiciled in the Republic of Cyprus will be exempted from Special Defence Contribution.



Non domiciled tax resident in Cyprus :

Income Income tax Special Defence Contribution(SDC)


Dividends Exempt Exempt


Interest Exempt Exempt


Rental income Taxable Exempt


An individual, who has a domiciled in Cyprus, will not be exempted from Special Defence Contribution with the exemption of:

  • An individual who obtained and maintained a domicile of choice outside Cyprus, provided that the individual is not a Cyprus tax resident for a period of at least 20 years prior to the tax year in question.

  • An individual who was not a Cyprus tax resident for a period of at least 20 years prior to 16/07/2015.

  • An individual ,who remains a Cyprus tax resident for a period of at least 17/20 years prior to the tax year in question , will be treated as domiciled in Cyprus for SDC purposes.


Domiciled and tax resident in Cyprus:


Income Income tax Special Defence Contribution(SDC)


Dividends Exempt 17%


Interest Exempt 30%


Rental income Taxable 3% on 75% of gross income



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