Cyprus Capital Gains Tax — Exemptions Extended from 1 January 2026 (Real Estate & Securities)

Background: The Limited Cyprus CGT Base

Unlike most EU jurisdictions, Cyprus does not have a general capital gains tax. The Capital Gains Tax Law of 1980 only applies to two narrow categories of disposals:

• **Disposals of Cyprus immovable property** (land + buildings located in Cyprus)
• **Disposals of shares in companies that own Cyprus immovable property**, where the property's value exceeds 50% of the company's net asset value

All other disposals — shares in non-property companies, securities, bonds, foreign immovable property, business goodwill, intellectual property — are entirely outside the Cyprus CGT regime. This makes Cyprus structurally one of the most tax-favourable EU jurisdictions for share-disposal exits.

The standard CGT rate (where it applies) is 20% on the gain. Several exemptions reduce or eliminate the liability for typical individual and family transactions.

What the 2026 Reform Changes

The 2026 amendments to the CGT Law focus on three areas:

1. Personal-Residence Exemption Ceiling Raised

An individual selling their main personal residence in Cyprus is exempt from CGT up to a lifetime ceiling. The pre-2026 ceiling was €85,430 (a legacy figure from 1980). From 2026 it has been raised to €175,000 to reflect current Cyprus property prices. This is a one-time-per-lifetime exemption — once consumed it cannot be reclaimed for a second residence sale.

For a Cyprus-resident individual selling their main home for, say, €450,000 (purchased for €200,000 in 2010), the gain is €250,000. Pre-2026: exempt up to €85,430, taxable on €164,570 → CGT €32,914. Post-2026: exempt up to €175,000, taxable on €75,000 → CGT €15,000. Saves €17,914.

2. 50% Relief for 2015–2026 Property Purchases — Made Permanent

From 2015 to 2025, Cyprus granted a 50% reduction in CGT on disposal of properties acquired during that 11-year window. This was originally a temporary stimulus for the post-2013 property market. The relief was due to expire on disposals after 31 December 2025.

The 2026 reform makes this 50% relief permanent for properties acquired between 16 July 2015 and 31 December 2025. So if you bought a Cyprus property in this window — irrespective of when you sell — you are entitled to a 50% reduction on the CGT due on disposal. This is a meaningful permanent reduction worth, for many investors, €30,000–€80,000 on a typical €1M property exit.

3. 0% CGT on Shares — Clarified for Crypto Tokens

Cyprus has long applied 0% CGT to disposals of shares in non-Cyprus-property companies. The 2026 reform explicitly clarifies that 'shares' for CGT purposes includes share-like crypto tokens — i.e. tokens that confer rights analogous to share ownership (governance, profit-sharing, voting). This brings DAO-issued governance tokens, security tokens, and similar instruments into the same 0% regime that applied to traditional equity disposals.

Note: this is a CGT clarification only. The new 8% SDC rate on crypto disposal gains (see our crypto article) applies separately under the SDC Law to non-share-like crypto-asset disposals. The two regimes are designed to be complementary, not overlapping.

What Has NOT Changed

Several core CGT principles continue unchanged:

• Standard CGT rate remains 20% on the taxable gain
• Inflation indexation continues to apply to acquisition costs (using the official Cyprus CPI)
• Lifetime exemption for inherited property (€17,086) is unchanged
• Lifetime exemption for agricultural land (€25,629) is unchanged
• The 5% transfer-fee relief for primary residence purchases is unchanged
• 0% CGT on disposals of foreign property remains — Cyprus has never asserted CGT over non-Cyprus-situate property

Strategic Implications

For Cyprus property investors who bought between 2015 and 2025, the permanent 50% relief is a meaningful structural benefit. The investment thesis on those holdings remains intact and slightly improved relative to expectations.

For Cyprus-resident families, the higher personal-residence exemption ceiling is a clean win on retirement / downsize sales — the typical family selling their long-term home will save €15,000–€30,000 in CGT under the new ceiling.

For Cyprus holding company structures, the 0% CGT regime on share disposals is unchanged — and is now explicitly extended to share-like crypto tokens. This further strengthens Cyprus as a structuring base for Web3 holding companies and DAO investment vehicles.

For inbound investors considering a Cyprus property purchase in 2026 onwards, the 50% relief no longer applies (it is bounded to the 2015–2025 acquisition window). Future buyers face the standard CGT regime, although the higher personal-residence exemption applies if they later use the property as their main home.

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Disclaimer: This article is for informational purposes only and does not constitute legal, tax, or financial advice. Tax laws change frequently. Consult a qualified Cyprus adviser for guidance specific to your situation. The information on this page is general guidance only and does not constitute legal, tax, accounting, immigration or financial advice. Specific advice should be obtained based on the facts of each case.