Overview of the 2026 Tax Framework
Cyprus has implemented targeted tax reforms effective from 1 January 2026, updating key areas of corporate taxation, personal taxation, dividend taxation, and tax residency rules. The Cyprus Tax Guide 2026 provides a clear and structured overview of the current tax framework, including applicable rates, exemptions, and compliance obligations.
Key Highlights
15% Corporate Tax | 5% Dividend Tax | €22,000 Tax-Free | 8% Crypto Tax
Corporate Taxation
- Corporate Income Tax increased to 15%
- Applies to Cyprus tax resident companies on worldwide income
- Participation exemption and IP regime remain available
Dividend Taxation (SDC)
- Dividend tax reduced to 5% for profits generated after 31/12/2025.
- Prior profits remain subject to 17% (transitional rules)
- Deemed Dividend Distribution abolished for profits generated after 31/12/2025.
Corporate Tax Residency
- Cyprus incorporation creates default tax residency (from 2026)
- Important for structuring international group operations
Personal Taxation
- Tax-free threshold: €22,000
- Progressive tax rates up to 35%
- Various deductions available
Tax Residency (Individuals)
- 60-day rule simplified
- Individuals may be tax resident in Cyprus even if resident elsewhere
- Potential dual residency implications
Crypto Taxation
- 8% flat tax on qualifying crypto gains
- Losses restricted within same year
- Mining excluded
Compliance & Framework
- Transfer Pricing requirements remain in place
- Cyprus continues to operate within OECD / EU guidelines.
What's included in the Guide
- Personal Income Tax
- Corporate Income Tax
- Special Defence Contribution (SDC)
- VAT and indirect taxes
- Capital Gains Tax
- Transfer Pricing
- IP Regime
- Tax Diary 2026
Access the full Cyprus Tax guide here.
If you would like to discuss how these changes may affect your structure or operations, we would be pleased to assist.
Book a Consultation.
