BRITISH PEOPLE TRAVELING OR RELOCATING AND WORKING IN CYPRUS AFTER BREXIT 1/01/21
British Citizens who are not holding residence documents of Yellow slips (MEU1, MEU2, MEU3)
and/or (MUKW1, MUKW2, MUKW3), will still be able to visit Cyprus but be subject to immigration
rules upon their arrival. UK people can visit Cyprus for a period of 90-day entry free-visa but their
passports will be stamped at the border checks during the entry/exit the same as all the other
Non-EU Nationalities.
In the event that UK nationals wish to extend their stay in Cyprus for more than 90 days, they can
apply either for temporary residency or permanent residency offered to non-EU nationals.
TEMPORARY RESIDENCE
Non-EU nationals who come to Cyprus for long-term purposes without employment rights can apply
for a temporary residence permit, commonly referred to as a ‘'Pink Slip'' which allow non-EU
nationals to extend their stay in Cyprus for more than 90 days. Applicants need to apply before their
visas expire. It is valid for one year and can be renewed on an annual basis with a limitation of
absence period out of the country, not more than 3 months continuously as the permit will be
cancelled.
When applying, the physical presence of the applicant and his dependent spouse and minor children
is required in order for the Migration Department to receive their biometric features (fingerprints
and photographs) as well as their signatures prior to the submission of the temporary residence
applications.
PERMANENT RESIDENCE
Non-EU nationals and their family members who wish to relocate permanently to Cyprus can apply
under any of the permanent residency types offered to non-EU nationals with the most famous of
them being the ‘Fast Track''-permanent residency scheme which concerns property purchase in
Cyprus and which was recently amended by the government authorities to include new types of
investments. Please see our guide for Permanent residency
Non-EU nationals can also apply for permanent residency on the basis of one of the Categories
referred to in the Aliens and Immigration Regulations. The below immigration permits are granted
for an unlimited duration to non-EU nationals who comply with the requirements of applying under
each Category:
Category A:
Persons who intend to work as self-employed in agriculture, cattle breeding, bird breeding or fish
culture in the Republic: provided that they have in their possession adequate land or a permit to
acquire same, they have fully and freely at their disposal necessary capital as provided for in the
regulations and such an employment should not negatively affect the general economy of the
Republic.
Category B:
Persons who intend to work as self-employed in mining enterprises in the Republic: provided that
they have in their possession a relative permit, they have fully and freely at their disposal the
necessary capital and such an employment should not negatively affect the general economy of the
Republic.
Category C:
Persons who intend to work as self-employed in a trade or profession in the Republic: provided that
they have in their possession a relative permit, they have fully and freely at their disposal the
required capital and that such an employment should not affect negatively the general economy of
the Republic.
Category D:
Persons who intend to work as self-employed in a profession or science in the Republic: provided
that they have academic or professional qualifications for which there is a demand in Cyprus.
Possession of adequate funds is also necessary.
Category E:
Persons who have been offered permanent employment in the country which will not create undue
local competition.
Category F
– Also known as the ‘Slow Track' permanent residency: Persons who have fully and freely at their
disposal a secure and regular annual income, which is high enough to provide a decent living in
Cyprus without having to engage in any business, trade or profession in Cyprus. The annual income
required should be at least €10.000 for a single applicant and moreover at least €5.000 for every
dependent person, but the Immigration Control Board may demand additional amounts as
necessary. This category is suitable for non-EU nationals who have savings from lawful sources from
abroad (salary, rentals, dividends, pensions etc.) and it is considered to be the most favourite choice
for pensioners or retirees. Purchasing a property in Cyprus under this category counts positively
towards the examination of the application but it is also possible to qualify merely with a rental
agreement. Each application is examined on its merits.
All of the abovementioned categories of applications are reviewed by the Immigration Control
Board, and the Minister of the Interior will grant final approval. Examination and processing of
applications takes around 12-18 months. If the applicants wish to stay in Cyprus during the
examination of their application, then they must apply for a temporary residence permit.
WORK PERMITS
Non-EU nationals who wish to work in Cyprus can apply for residency permits that are available to
non-EU nationals who wish to reside and work in Cyprus.
Subject to certain requirements, it is possible to apply for a temporary residence and employment
permit as an employee of existing and new company of foreign interests registered in Cyprus
(majority of the company's shares must be owned by third-country nationals) as well as companies
that have joined the Fast-Track Business Activation Mechanism.
In addition, subject to certain requirements, it is possible, for Non-EU Nationals to be employed by
a Cypriot company and for them to obtain a work permit. The application would be submitted to
the District Labour Offices that will investigate and confirm that the criteria for the employment of
foreigners are being met, and that there is no availability of adequately qualified Cypriot or
European citizens.
Cyprus Tax Residency for Individuals and Non-Domiciled Status Imposition of Tax
A Cyprus tax resident, is taxed on income accruing or arising from sources both within and outside
the Republic of Cyprus, whereas a non-Tax resident of Cyprus is only taxed on income accruing or
arising from sources within the Republic.
Tax Residency
Cyprus taxation scheme is based on the principle of residence and there are two main rules
someone can choose to become a Cyprus Tax resident.
A. The 183-day rule
An individual is considered a tax resident of Cyprus if he spends more than 183 days in the Republic
in a tax year (1st of January to 31st of December). Consequently, if the individual is physically present
in Cyprus for less than 183 days in a tax year, he will be considered to be a non-Cyprus tax resident
in that tax year.
B. The 60 days rule
As of 1st January 2017, an individual can be considered as a tax resident of the Republic even if he
spends less than 183 days provide, he meets all of the following conditions within the same tax year
(1st of January to 31st of December):
1. Does not stay in any other country, for one or more periods exceeding in aggregate 183
days;
2. Is not a tax resident of any other country;
3. Spends at least 60 days in Cyprus;
4. Maintains a permanent home in Cyprus either owned or rented;
5. Carries out business activities in Cyprus and/or is employed in Cyprus and/or holds be a
director in a company that is tax resident in Cyprus;
If during the year the business, employment or holding of an office is terminated, then the individual
shall not be treated as a Cyprus tax resident for that tax year.
Calculation of days
To calculate the days of presence in Cyprus
1. The day of arrival in Cyprus is deemed to be a day in the Republic
2. The day of departure from Cyprus is deemed to be a day outside of the Republic
3. The arrival into the Republic and departure from the Republic on the same day is considered
as a day in the Republic
4. The departure from the Republic and the arrival in the Republic on the same day is
considered as a day out of the Republic
Definition of Non-Domiciled Persons
In accordance with the provisions of the Wills and Succession Law, there are two kinds of domicile:
• Domicile of origin: i.e. the domicile received by an individual at birth; or
• Domicile of choice: i.e. the domicile acquired by an individual by establishing physical
presence in a particular place with the intention to make it the place of permanent residence
Irrespective of the domicile of origin or choice, individuals who have been tax residents in Cyprus
for at least 17 out of the last 20 years prior to the tax year in question, will be deemed to be
domiciled in Cyprus for the purposes of the SDC Law.
In the case of persons who have their domicile of origin in Cyprus, they will nevertheless be
considered as non-domicile in the following cases:
• If they have acquired and maintained a domicile of choice outside Cyprus, provided that
they were not tax residents in Cyprus for any continuous period of at least 20 consecutive
years prior to the tax year in question; or
• If they were not tax residents in Cyprus for a period of at least 20 consecutive years
immediately prior to the entry into force of the non-domicile provisions (i.e prior to
16/07/2015).
•
Tax Benefits of Non-Domiciled Persons
As per the provisions of the Cyprus SDC Law, dividends and bank deposit interest earned by
individuals who are tax residents in Cyprus are subject to SDC tax at the rate of 17% and 30%
respectively, regardless of the source of the income (i.e. from Cyprus or from abroad). SDC tax
applies only for individuals who are both Cypriot tax residents and domiciled in Cyprus.
Therefore, non-domiciled tax residents will be completely tax exempt from any dividends and
interest received in Cyprus (except for minimal GeSY contributions), Since 1 March 2019, Dividend
income is subject to GeSY contributions, (at the rate of 1.7% from 1 March 2019 until the 29
February 2020, then increased to 2.65% from March 1, 2020), restricted to a maximum of
EUR180,000 income annually.
Further tax advantages for individuals
Furthermore, irrespective of domicility, foreigners who become Cypriot tax residents enjoy a range
of other significant income tax advantages with the main ones being the following:
1. Interest and dividends are liable to SDC instead of income tax, but non-Cyprus domiciles are
exempt (except for minimal GeSY contributions).
2. Profit from sale of shares and other qualifying titles is specifically exempt from Cyprus
taxation, provided that the underlying assets do not include immovable property located in
Cyprus.
3. First €19,500 of taxable income is tax exempt. Any taxable personal income in excess of this
amount is taxed at progressive rates ranging from 20% to 35% (for incomes over €60,000).
4. 50% exemption for remuneration from employment exercised in Cyprus by persons who
were resident outside Cyprus before commencement of their employment. The exemption
applies for a period of 10 years commencing from the year of employment, if such income
exceeds €100,000 per year.
5. In case of Cypriot remuneration, which is less than €100,000, a 20% exemption is granted or
€8,550 – whichever is lower. For employment commencing between 2012 and 2025, the
exemption applies for a period of 5 years starting from the tax year following the year of
employment.
6. 100% exemption on remuneration from the rendering of salaried services outside Cyprus to
a non-resident employer or a permanent establishment outside the Republic of a resident
employer, for an aggregate period in the year of assessment of more than 90 days.
7. In case of Cypriot immovable property acquired up to 31st December 2016, profit from
subsequent future disposal of such property will be exempt from the 20% Capital Gains Tax.
8. Pension received in respect of past employment abroad is taxed in Cyprus at the flat rate of
5% for amounts exceeding €3,420 per year.
9. No inheritance tax, no wealth tax, no gift taxation.
10. In case of individuals who are beneficiaries to a Trust, such individuals would be exempt
from tax in Cyprus, to the extent that the income at/from the Trust would be in the form of
interest or dividends.
WORK PERMITS FOR FOREIGN INVESTORS
In an attempt to encourage business people to set up their headquarters or expand their operations
in Cyprus, our government has recently reviewed the policy regarding the issuance of temporary
residence and employment permits to employees of existing and new companies of foreign
interests registered in Cyprus, as well as companies that have joined the Fast Track Business
Activation Mechanism.
The Policy
For the employment of a third-country national in the Republic a temporary residence and
employment permit is necessary. A key pillar of the review is the possibility for companies of foreign
interests to employ an increased number of staff in key positions, while at the same time the
employees' family members can be granted Cyprus residence permits. The criteria that companies
must meet in order to benefit from this policy, the categories of staff and the maximum numbers
of third-country nationals who can be employed per category are described in the following
paragraphs.
Eligible Companies
For a company to be qualified as a Company of foreign interests and to be eligible to employ thirdcountry nationals in Cyprus must meet the following criteria:
1. Third country shareholders should own the majority of the company's shares. In the case where
companies are the shareholders, their final owners (natural persons who are the ultimate beneficial
owners) should be declared, in order to receive the approval of the Civil Registry and Migration
Department.
2. Foreign direct investment from the ultimate beneficial owner of at least €200.000 in Cyprus, for
the purposes of operating the company in Cyprus. Thisrequirement only appliesto companieswhich
will employ staff from third countries for the first time. The paid-up capital of €200.000 can either
be a payment made into a bank account or an investment in a company asset such as immovable
assets and/or rents and/or the cost of any equipment for the needs of the company.
If the percentage of foreign participation in the company's share capital is equal to or less than 50%
of the total share capital, in order for the company to be considered as eligible, then the foreign
participation should represent an amount equal to or greater than the amount of €200.000.
3. The company should operate on its own self-contained offices in Cyprus in suitable premises,
separate from any private housing or another office, except in the case of business co-habitation.
Staff Categories
Companies that meet the above conditions are entitled to employ third-country nationals in the
following categories, provided that they first obtain temporary residence and employment permits.
Category 1 – Directors:
In this category the following third-country nationals are included:
• Directors or Partners registered in the Registrar of Companies and Official Receiver
• General Managers of branches and subsidiary companies of foreign companies
• Departmental Managers
• Project Managers
The minimum acceptable gross monthly salary for Directors is €4.000, which may be adjusted from
time to time, depending on fluctuations in the wage index.
Five (5) is the maximum number of third-country nationals that can be employed under this
category, unless the Civil Registry and Migration Department is satisfied that the employment of a
greater number is justified, depending on each company's circumstances.
Category 2 – Middle management executives and other key personnel:
In this category the following third-country nationals are included:
• Upper / middle management personnel,
• Other administrative, secretarial or technical staff
The minimum acceptable gross monthly salary for this category is €2.000, which may be adjusted
from time to time, depending on wage index fluctuations.
Ten (10) is the maximum number of third-country nationals that can be employed under this
category, unless the Civil Registry and Migration Department is satisfied that the employment of a
greater number is justified, depending on each company's circumstances.
Category 3 – Specialists:
Companies are entitled to employ third-country nationals in professions / with skills as listed in
Table 1 below. The number of employees that may be employed by each company will be
determined based on its turnover, as described in Table 2.
The minimum acceptable gross monthly earnings for Specialists is €2.000, which can be adjusted
from time to time, depending on fluctuations in the wage index.
Table 1.
# Professions / Skills
1 Software and System Engineers
2 Application and Data Architects
3
Information and Communication Technology and Enterprise Solution
Architects
4 Technical Assurance Professionals
5 Telecom and Space Engineers
6 Data scientists
7 Machine Learning Engineers
8 Web Developers and designers
9 UX User Experience Professionals
10 Quantitative Analysts
11 Quality Assurance Analysts
12 Mobile Application Developers
13 Augmented Reality/ Virtual Reality Programmers
14 Digital Marketing Specialists
15 Video Production Multimedia Specialists for Mobile Apps and Software
16 Analysts for Mobile Apps and Software
17 Designers of Prototype for Mobile Devices
18 DevOps Engineers
19 Cyber Security Specialists
20 Artificial Intelligence, Robotics and Big Data Specialists
21 Pharmaceutical Formulation Technologists
22 Pharmaceutical Engineer Validation Specialists
23 Pharmaceutical Patents Specialists
24 Pharmaceutical Regulatory and Quality Assurance Professionals
25 Marine Engineers
26 Naval Architects
Table 2.
Specialists
Based on annual turnover* ≤1 million: 5 > €1 – €3 millions: 10 > €3 –
€5 millions: 20 > €5 – €10 millions: 30 > €10 – €20 millions: 50 > €20
– €30 millions: 100 > €30 million: 200* For eligible companies that
relocate to Cyprus and have joined the Fast Track Business Activation
Mechanism, the turnover that will be taken into account will be the
one of the company's abroad. This will be valid for the first two years
of operations in Cyprus. Following the first two years, the annual
turnover of the company in Cyprus will be taken into account.
Companies already registered in the Register of Foreign Companies of the Civil Registry and
Migration Department can automatically benefit from the Policy for the employment of third country nationals in the Specialists' category.
Category 4 – Support staff:
What happens with all third-country nationals not included in the above categories? Companies are
expected to fill in positions in this category with Cypriot or European citizens. In the case where
there are no qualified Cypriots or European citizens available, a company may employ third-country
nationals in posts in this category at a rate of 30% of the total staff, by first securing the positive
recommendation (sealed employment contract) of the Department of Labour which, for the
granting of its positive recommendation, considers the above percentage.
Maximum number of third-country employees per staff category
# Staff Category Maximum allowed number
1 Directors 5
2
Middle
management
executives and
other key
personnel
10
3 Specialists
Based on annual turnover*≤1 million: 5>€1 – €3
million: 10>€3 – €5 million: 20>€5 – €10 millions: 30>€10
– €20 million: 50 > €20 – €30 millions: 100 > €30
million: 200* For eligible companies that relocate to
Cyprus and have joined the Fast Track Business Activation
Mechanism, the turnover that will be taken into account
will be the one of the company's abroad. This will be valid
for the first two years of operations in Cyprus. Following
the first two years, the annual turnover of the company
in Cyprus will be taken into account.
4 Support Staff 30% of the total staff (will be reviewed by the
Department of Labour during the labor market test).
For employing a greater number of third country personnel under the above categories, duly
justified and documented requests by the company must be submitted to the Department. The
requests must include information on the salary offered as well as:
• The company's turnover
• The ratio of third-country employees to Cypriots / EU Nationals and
• The company's operating time in Cyprus.
In order to exceed the limit of more than 300 third-country nationals employed in categories 1-3
above, the consent of the Council of Ministers is required.
It is stressed that the requests should only concern specific persons whose employment is
considered necessary by the company. General requests on the matter cannot be considered.
Validity of Temporary Residence and Employment Permit
Where the conditions foreseen in the law are met, the third-country national is granted a temporary
residence and employment permit. The permit's validity depends on the duration of the
employment contract and can be up to two (2) years, with a right of renewal. Directors, Middle
management executives and other key personnel as well as Specialists (Staff categories 1-3) may
reside in the Republic without a time limit, provided they hold a valid temporary residence and
employment permit.
For support staff, the restrictions applicable to the general employment policy of third country
nationals in the Republic apply.
Family Members
Third-country nationals with residence and employment permits under staff categories 1-3 of the
Policy, have direct access to family reunification with their family members
With thanks to Red Tape Resolved
