Cyprus Non-Dom Status

Contributed by GoOffShoreNow, 24 September, 2018

In 2015, Cyprus introduced the new Non-Dom status, which affects physical persons that consider to use Cyprus as their tax seat and gain from the favourable tax regime both in a corporate and personal level.

The main point of the reform has to do with a change in a tax known as Special Defence Contribution tax (SDC).

The change in question is effective as from the 16th of July 2015.

SDC Tax Rates Prior to the Amendment

Prior to the amendment a tax resident non-dom individual would pay the following taxes:

The SDC law also included provisions for the deemed distribution of profits of Cypriot tax resident companies where the shareholders (beneficiaries) of such companies are Cyprus tax resident individuals.

What change is it introduced by the amendment of the SDC law?

Following the amendment to the SDC law, Cyprus resident non-dom individuals will no longer be subject to SDC taxes.

However an individual who is a tax resident of Cyprus for a period of at least 17 out of the last 20 years prior to the tax year of assessment cannot benefit from the above exception.

Effectively this means that if a non tax resident non-dom individual becomes tax resident in Cyprus this year he will not be liable to pay SDC tax for the next 17 years.

How is the domiciled status determined?

The SDC law defines the term domicile with reference to the Will and Succession Law of Cyprus.

An individual is considered to have a domicile in Cyprus either:

The Wills and Succession Law provides that:

Tags: Tax | Tax Rates | individuals | Cyprus | law | tax |



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