The legal system in Cyprus is based on the British system. It protects the purchaser’s rights in many ways. For the purchasers protection the Cyprus land registry provides a simple and effective legal "instrument specific performance”. Once the contract of sale is signed and the deposit has been paid, the contract is registered at the land registry. This protects the ownership rights until the title deeds are issued and transferred to the purchaser’s name. Once the contract is lodged with the land registry it cannot be withdrawn by anyone. The property cannot be leased, sold, transferred or mortgaged unless by the purchaser.
Transfer Fees
These are payable by the purchaser when the property is registered in their name at the District Land Offices. They are based on the market value of the property on the day of purchase.
The rates applied are;
3.0% on the first CYP£50,000(€ 85430)
5.0% on CYP£50,001-CYP£100,000 (€ 85432 - € 170860)
8.00% over CYP£100,000(€ 170860)
Immovable Property Tax
The annual immovable property tax is calculated on the market value of the property as at 1st January 1980 and is payable by the owner of the property.
Market value of property (CYP) ( € )
Annual Property tax (%)
up to 100,000(€ 170860)
exempt
100,001 to 250,000 (€ 170862 - € 427150)
2.5
250,001 to 500,000 (€ 427152 - € 854301)
3.5
over 500,000 (€ 854301)
4.0
Capital Gains Tax
Capital Gains Tax is payable upon disposal of a property. The first CYP£10,000(€ 17086) for each person is exempt. The rate payable is 20%. The gains are the difference between the sales proceeds and the original cost of the property.
On top of this allowance, the seller is entitled to a further allowance regarding the transfer fees paid, inflation rate per year and the cost of any additions made to the house receipts should be kept for all addition to the house etc.
Stamp Duty
The purchaser is liable for the payment of stamp duty at the rate of 1.50 CYP(€ 2.56) per thousand up to the value of 100.000 CYP (€ 170860) and thereafter at the rate of 2 CYP (€ 3.42) per thousand.
For example if the purchase price is CYP 150. 000 (€ 256290)
first CYP 100 000 (€ 170860) 0.15%
CYP 150 (€ 256)
next CYP 50 000 (€ 85430) 0.2%
CYP 100 (€ 171)
Total CYP 250(€ 427)
Estate Duty
Estate Duty tax has been abolished as from the first of January 2000 (Statute No.78(1)/2000).
Mortgage Finance for purchasing property in Cyprus
All commercial banks in Cyprus offer mortgage facilities in any currency to assist in the purchase of property in Cyprus.
The amount ranges from 60%- 80% of the value of the property with a repayment period up to 40 years depending on the policy of the bank and the currency of the loan.
