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Cyprus Property Rental Tax – Rates and Regulations
Property Rental Taxes in Cyprus – A Landlords' Guide
Cyprus is an attractive destination for property investors, particularly in the short-term and long-term rental sectors. However, every owner should be aware of the basic principles of rental income taxation on the island.
Types of Rental
- Long-term rental – flats and houses rented for many months or years.
- Short-term rental – holiday apartments, Airbnb, Booking, and other travel platforms.
All forms of renting carry tax obligations.
Income tax on rental income
Rental income is treated as personal income owner and is subject to Cypriot income tax.
Tax thresholds (2025):
- 0 € – 19,500 € 0%
- 19 501 € – 28 000 € → 20%
- £23,835 – £32,750 25%
- 36,301 € – 60,000 € → 30%
- over €60,000 35%
Allowable expenses
From revenue, you can deduct:
- cost of maintaining a property,
- Administration fees,
- depreciation of a building,
- mortgage interest.
Special Defence Contribution (SDC)
Cyprus tax residents also pay 3% SDC from rental income.
👉 Important: people who are tax non-residents, they don't pay that tax.
VAT on rental
- Residential lettings outside the scope of VAT.
- Short-term rentals (e.g. tourist) may be covered by 19% VAT, if the owner registered as a VAT taxpayer.
Short-term rental registration
For several years, tourist rentals have had to be declared and registered in Deputy Ministry of Tourism. Failure to register may result in fines.
Summary
- Rental income is taxed according to tax brackets.
- Residents pay extra 3% SDC.
- Long-term rental is simpler tax-wise than short-term rental.
- It is worth keeping accounts and using the services of a local tax advisor to avoid problems.
Renting out property in Cyprus is a profitable investment, but it requires knowledge of local tax regulations.
The article is for informational purposes only and does not constitute tax advice. It is recommended to consult with a professional advisor before commencing renting.