According to amendments to the Central Agency for Equal Distribution of Burdens Law published on 18/11/2022 (Law 172(I)/2022), starting from 18/11/2022 a new tax of 0,4% is imposed on the sale of property and sale of Cyprus company shares owing property in Cyprus.

Please note that tax of 0,4% also applies retrospectively to the property deals and transfers of shares filled with the Land registry or Cyprus Companies Registrar, respectively, within the period 22/02/2021 – 18/11/2022. Sellers in such deals were given a reasonable period of time for the settlement of the new tax payment without imposition of any fines.

This law applies to:

• Sale of properties located in Cyprus (transfers by means of a gift are excluded). Here the tax is calculated on the basis of the sale price of the property.
• Sale of shares of Cyprus company which directly or indirectly owns real estate in Cyprus and shares of which are not listed on any recognized Stock Exchange. Here the seller pays a fee equal to a percentage of 0.4% of the latest value assessed by the Department of Cadastre and Land Surveying of the immovable property in question corresponding to the company shares being sold.

Authority responsible for the imposition and collection of a 0.4% tax is the Tax Commissioner. So, before you will proceed with the registration of property in the name of the new owner or transfer shares of subjected companies, seller needs to pay 0,4% tax and receive a payment certificate from Tax Commissioner.

As per the Law, there are exceptional cases when tax of 0,4% should not be paid:

1. when restructuring of a non-performing loan takes place as per the Capital Gains Taxation Law
2. in cases of company reorganisation as per the article 30 of the Income Tax Law and articles 198 to 200 of the Companies Law
3. If filing of property sale or share transfer to Land Registry or Companies Registrar was performed prior to 22/2/2021.

Please note that if you fail to pay the tax, the Tax Commissioner shall take legal action to collect any amount due as a civil debt owed to the Republic.