News brief · Taxation

Cyprus: extension of non-dom status to 27 years confirmed

Cypriot non-dom status is said to last seventeen years. A second, longer duration is in circulation, and the difference lies in two notions that Cypriot law distinguishes carefully.

By Editorial team · on March 3, 2026

View of Limassol — Photo: Xaris333 — Wikimedia Commons (CC BY-SA)

Two durations, two notions

Non-dom status exempts passive income — dividends and interest — from the special defence contribution, for a Cypriot tax resident who is not domiciled there.

A first duration appears in our sources: 17 years¹ of tax residency, after which a person is deemed to have acquired a Cypriot domicile and loses the benefit of the status.

A second, longer duration circulates in commercial presentations of the regime. We do not publish it: we found no official Cypriot source specifying which rule it would correspond to. It must be established with the tax department before any long-term plan, and it should not be taken for granted.

What can be said is that Cypriot law distinguishes the domicile of origin from the domicile of choice, and that acquiring a deemed Cypriot domicile follows its own rules, separate from a simple count of years of residence.

This uncertainty illustrates a principle of method that applies to any international tax plan: a duration circulating without reference to a legal text is not a fact; it is a rumour. It is either verified with the administration concerned, or it is not used.

What the status covers

The exemption concerns the special defence contribution, which is levied on the dividends and interest of a domiciled resident. It is therefore not a general exemption.

A contribution to the healthcare system remains payable on this income at a rate of 2.65%², up to an annual ceiling. This is the only charge on a dividend received by a non-domiciled resident.

Earned income is subject to the tax scale, which ranges from 0%³ to 35%⁴. Gains on the sale of securities are not taxed, at a rate of 0%⁵.

The first-employment deduction completes the scheme: 50%⁶ of remuneration is deductible above an annual threshold of more than €55,000⁷.

Corporate tax has been raised to 15%⁸, from 12.5%⁹ previously, as a result of the global minimum tax.

The two routes to tax residency

The general rule is based on presence of more than less than 183 days¹⁰ during the calendar year.

The so-called sixty-day rule allows tax residency with presence of at least from 60 days¹¹, subject to four cumulative conditions: not staying more than one hundred and eighty-three days in any other State, not being a tax resident elsewhere, carrying on a business or holding a directorship in Cyprus, and having a permanent home there.

Failing just one of them removes the benefit of the rule, and the second is the hardest to meet for anyone who keeps ties in their home country.

The burden of proof also lies with the taxpayer. The supporting documents — lease, utility bills, contract or mandate, records of presence — are built up over the year, not at the time of an audit.

Key takeaways

The exemption concerns the defence contribution, not income tax.
The 2.65%² health contribution remains payable on passive income.
The status is limited in time: a very long-term plan must factor in its expiry.
The from 60 days¹¹ rule requires four cumulative conditions and evidence built up as you go.
Corporate tax has gone up: for a company director, it is the combined cost that counts.

Finally, the non-dom regime itself is under debate in several States. The United Kingdom has ended its own, which sets a notable precedent for the jurisdictions that operate one. Cyprus offers one of the most favourable frameworks in the European Union for passive income, but a twenty-year plan must take this uncertainty into account as much as the advertised durations.

Please note

General information, as of the date shown. A draft reform is not a rule in force: check the conditions with the authorities or a professional before deciding. Terms of use and disclaimers

Sources and verification dates

1.
Cyprus: period of tax residency after which a person is deemed domiciled : 17 years
« Furthermore, irrespective of the individual’s domicile of origin, any individual who has been a Cyprus tax resident for income tax purposes for at least 17 out of the last 20 years immediately before the tax year is deemed to acquire a domicile in Cyprus. […] Tax Consequences — Any individual who either: does not have a domicile in Cyprus (non-domiciled), or is not a Cyprus tax resident (non-resident) is not subject to Special Defence Contribution (SDC) on: rental income*; interest income; dividend income. — Tax Department, « Tax Residency/Domicility » (Special Defence Contribution Law N. 117(I)/2002). »
gov.cyVerified on Nov 2, 2026Verified source
2.
Cyprus: rate of the healthcare system contribution on passive income, at full effect : 2.65%
« Income earners (e.g. rent, interest, dividends) 1,70% 2,65% On their income »
gesy.org.cyVerified on Nov 2, 2026Verified source
3.
Cyprus: rate of the first income tax bracket : 0%
« DECLARATION FOR CLAIMING TAX DEDUCTIONS FOR THE TAX YEAR 2026 - Income Tax (By virtue of the Income Tax Law No.118(I) of 2002, as amended) — PART C. TAX COMPUTATION — Chargeable Income / Tax Rates : From 0 to 22.000 @ 0% ; From 22.001 to 32.000 @ 20 % ; From 32.001 to 42.000 @ 25 % ; From 42.001 to 72.000 @ 30 % ; From 72.001 @ 35 % — Tax Department, formulaire IR59 2026. »
gov.cyVerified on Nov 2, 2026Verified source
4.
Cyprus: top marginal income tax rate : 35%
« PART C. TAX COMPUTATION — Chargeable Income / Tax Rates : From 0 to 22.000 @ 0% ; […] From 42.001 to 72.000 @ 30 % ; From 72.001 @ 35 % — Tax Department, formulaire IR59 2026 (Income Tax Law No.118(I) of 2002, as amended). »
gov.cyVerified on Nov 2, 2026Verified source
5.
Cyprus: taxation of profits from the disposal of securities : 0%
« Tax wholly exempted income of: Profit from the sale of securities ; Dividends paid which are tax deductible from the paying co. ; Profits of a Permanent Establishment under certain criteria ; Gains relating to foreign exchange differences (forex) […] — Ministry of Finance, « Tax Incentives » (15 janvier 2026). »
gov.cyVerified on Nov 2, 2026Verified source
6.
Cyprus: share of remuneration deductible for a first employment in the Republic : 50%
« If you are claiming a deduction for first employment in the Republic you are allowed to deduct either (a) 20% of your emoluments from any employment with a maximum of 8.550, or (b) 50% of your emoluments from any employment provided that your salary exceeds 100.000 in the tax year according to circular 2017/4 (EE04), or (c) 50% of your emoluments from any employment provided that your salary exceeds 55.000 in the tax year according to circular 2022/10 and 2024/04. — Tax Department, formulaire IR59 2026, notes (Income Tax Law, art. 8(23A)). »
gov.cyVerified on Nov 2, 2026Verified source
7.
Cyprus: annual remuneration above which the first-employment deduction applies : €55,000
« (c) 50% of your emoluments from any employment provided that your salary exceeds 55.000 in the tax year according to circular 2022/10 and 2024/04. — Tax Department, formulaire IR59 2026, notes. »
gov.cyVerified on Nov 2, 2026Verified source
8.
Cyprus: corporate income tax rate resulting from the tax reform : 15%
« Φόρος πραγματικών μερισμάτων από 17% σε 5% · Κατάργηση λογιζόμενης διανομής μερισμάτων · Εταιρικός φόρος από 12,5% σε 15% · Κατάργηση τελών χαρτοσήμων · Stock Options: ειδικός συντελεστής 8% έως €1εκ./10ετία · Κρυπτοστοιχεία: αυτοτελής φορολόγηση 8% στο καθαρό κέρδος — Portail officiel de la Réforme fiscale 2026 (gov.cy/taxreform), « Avantages fiscaux pour les entreprises » (lois publiées au Journal officiel le 31 décembre 2025, en vigueur au 1er janvier 2026). »
gov.cyVerified on Nov 2, 2026Verified source
9.
Cyprus: former corporate income tax rate, before the tax reform : 12.5%
« Φόρος πραγματικών μερισμάτων από 17% σε 5% · Κατάργηση λογιζόμενης διανομής μερισμάτων · Εταιρικός φόρος από 12,5% σε 15% · Κατάργηση τελών χαρτοσήμων · Stock Options: ειδικός συντελεστής 8% έως €1εκ./10ετία · Κρυπτοστοιχεία: αυτοτελής φορολόγηση 8% στο καθαρό κέρδος — Portail officiel de la Réforme fiscale 2026 (gov.cy/taxreform), « Avantages fiscaux pour les entreprises » (lois publiées au Journal officiel le 31 décembre 2025, en vigueur au 1er janvier 2026). »
gov.cyHistorical value, applicable until January 1, 2026
10.
Cyprus: annual presence below which the general residency rule does not apply : 183 days
« According to Article 2 (“Definitions”) of the Income Tax Law of 2002 (Ν. 118(I)/2002), a natural person (individual) is considered a tax resident of Cyprus if they meet the criteria set out either under the 183-day rule or the 60-day rule. 183-day rule — An individual is considered to reside in Cyprus if they stay in Cyprus for one or more periods exceeding 183 days in total during a tax year. — Tax Department (Ministry of Finance), « Tax Residency/Domicility ». »
gov.cyVerified on Nov 2, 2026Verified source
11.
Cyprus: minimum annual presence under the so-called sixty-day rule : 60 days
« 60-day rule — An individual may be considered a tax resident of Cyprus even if they have not completed 183 days in Cyprus, provided that they meet all of the following conditions: They remain in Cyprus for at least 60 days during the tax year. They do not reside for more than 183 days during the year in another country. They carry on any business in Cyprus and/or are employed in Cyprus, whether as an employee and/or office holder. They maintain a permanent residence in Cyprus which they own or rent. — Tax Department, « Tax Residency/Domicility » (Income Tax Law N. 118(I)/2002, art. 2). »
gov.cyVerified on Nov 2, 2026Verified source