Cyprus: Amendments regarding tax payable on sales of immovable property

Amendments regarding the 0.40% tax payable upon the sale of immovable property

Amendments regarding the 0.40% tax payable upon the sale of immovable property

Amendments regarding the 0.40% tax payable upon the sale of immovable property were published on 18 November 2022. Under the amendments, the tax will be imposed and collected under the following rules and conditions:

The tax is imposed upon the sale of:

  • “Immovable property” as defined in the Immovable Property (Tenure, Registration and Valuation) Law Cap.224
  • Shares of a company not listed on a recognized stock exchange (regardless of percentage holding) that directly or indirectly holds immovable property with a recorded general estimation value under a general valuation and revaluation survey

The tax is calculated:

  • In the case of disposal of immovable property directly, on the sale amount
  • In the case of disposal of company shares, on the latest general valuation value of the property attributed to the shares

No tax is imposed in the case of:

  • A restructuring of a non-performing loan as defined in the Capital Gains Tax Law
  • A company reorganization as defined in the Income Tax Law
  • A sale filed either with the Department of Land and Surveys or the Cyprus Registrar of Companies as the case may be prior to 22 February 2021

The tax authority issued an announcement on 21 November 2022 clarifying that it intends to grant a reasonable period of time to settle obligations that have arisen during the period between the initial enactment of the law imposing the tax (22 February 2021) and the current amending legislation (18 November 2022) and will not impose interest or penalties on such settled amounts.

Read a November 2022 report prepared by the KPMG member firm in Cyprus


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