How much capital gain tax would I pay if I sell my property in Cyprus?

Capital gains tax is levied at a fixed rate of 20% on both individuals and companies. Capital gain tax is calculated based on gains arising from the disposal of immovable property situated in Cyprus including gains from the disposal of shares in companies, which own such immovable property, excluding shares listed on any recognised stock exchange. 

The capital gain tax is calculated after deducting from the sales proceeds the original cost and any additional expenditure, adjusted for inflation, and any allowable expenses directly related to the disposal of the building such as interest on loan, real estate fees and advertising. It must be noted that if the property is purchased prior to 1980, the cost used in the calculation is the market value of the asset as at 1.1.1980.

However, there are some exemptions. These exemptions apply only for an individual (not for legal entities) and are used for reducing the taxable gain. The following exemption(s) is given once in the lifetime and the maximum amount provided subject to conditions, is €85.430.

(By combining a number of exceptions the maximum is €85.430)

The exemptions are as follows:

• Gains from any kind of property sale: Exemption: €17.086 (i.e. first sale). 

• Agricultural land (if the main occupation is agriculture i.e. farmer): Exemption: €25.629. 

• Exchange between properties that have equal value. 

• Sale of the main residence - Exemption up to: €85.430. 

To be eligible for the exemption: (Sale of the main residence - Exemptions up to: €85.430) : 

1. The house must be used by the owner exclusively for his own habitation, for at least 5 years (10 years if second time). 

2. The period of use does not necessarily have to be continuous. 

3. Use of the resident means use by the owner. 

4. Situated on land that does not exceed 1.500 square meters. 

5. Where the residence is built on land exceeding 1.500 square meters, tax is payable on the proportion of the gain accruing from the sale of the land in excess of the 1.500 square meters.