By Nexora Cyprus editorial team · General information — seek advice for your circumstances
Quick answer
Cyprus tax residency is obtained via the 183-day rule or the 60-day rule (clarified in 2026 to permit dual residency under treaty tie-breakers). A non-Cyprus-domiciled resident then pays 0% Special Defence Contribution on dividends, interest and rent for 17 years — versus 5% / 17% for a domiciled resident — which is what makes the residency-plus-non-dom combination one of the EU's most tax-efficient relocation setups.
2026 Update
The 60-day rule no longer requires exclusive tax residency — dual residency allowed with treaty tie-breaker rules. High-earner exemption extended to 17 years. PIT tax-free threshold raised to €22,000.
Spend 183+ days in Cyprus = automatic tax resident. No application needed. Days of arrival/departure count. No property, employment, or business requirement.
Become tax resident with only 60 days in Cyprus if you meet all conditions. 2026 change: dual tax residency is now permitted — you no longer need to prove you are not tax resident elsewhere.
Non-Cyprus domiciled residents are exempt from SDC. Available for 17 years from first year of Cyprus tax residency. No formal application — arises automatically. Use our eligibility test to check.
SDC: Domiciled vs Non-Dom
| Income | Domiciled | Non-Dom |
|---|---|---|
| Dividends | 5% | 0% |
| Interest | 17% | 0% |
| Rental (foreign) | Abolished 2026 | 0% |
Salary over €55,000 + new resident (not resident for 15 prior years) = 50% income tax exemption for 17 years. One of the EU's most generous incentives.
Calculate your tax: personal tax calculator. See our tax residency service for pricing.
Personal Income Tax
| Income | Rate |
|---|---|
| €0–€22,000 | 0% |
| €22,001–€32,000 | 20% |
| €32,001–€42,000 | 25% |
| €42,001–€72,000 | 30% |
| Over €72,000 | 35% |
A non-Cyprus-domiciled founder draws €100,000 a year in dividends from their Cyprus company. Special Defence Contribution is €0 (non-dom) — a domiciled resident would pay €5,000 (5%). The only charge is the General Healthcare System (GeSY) contribution at 2.65% (€2,650), itself subject to the €180,000 annual-income cap, so GeSY never exceeds about €4,770 across all income. Over the 17-year non-dom window the SDC saving alone is roughly €85,000 on €100,000 of dividends a year — against a one-off registration cost.
Domicile of origin, domicile of choice and residence history must be assessed separately. The deemed-domicile rule considers residence in at least 17 of the preceding 20 years. Eligible individuals may apply for the separate Article 3D five-year regime, requiring €250,000 in one payment after approval, rather than an annual €50,000 fee. See the SDC Law.
Tax residency and non-dom are declared to the Cyprus Tax Department rather than applied for: you obtain a Tax Identification Number, register your residency under the chosen route, and file the domicile declaration. The specific forms — including TD38, the TD38QA questionnaire for the 60-day route, and TD126 — are walked through in the dedicated Cyprus tax-residency forms guide. From 2026 every Cyprus tax-resident aged 25–70 must also file an annual IR1 return regardless of income: non-dom is an SDC exemption, not a filing exemption.
Cyprus Tax Department documents and Cyprus Tax Reform 2026 material publish the controlling material for this topic. Check the current law, form, circular or portal instructions before acting; this article is general information and the live official material prevails.
Related Guides
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.
— References linked in this article
Read each reference alongside the claim it accompanies and check current amendments before relying on it. General information — seek advice for your circumstances.
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