If you buy or inherit a property in Cyprus, there are ongoing obligations that you need to meet to ensure that you continue to comply with Cypriot law.
As with owning property anywhere else, it makes sense to insure your property and contents for your home in Cyprus.
This is normally paid annually in one lump sum. The amount will depend on the location, size and age of the property.
Non-payment of Council Tax can lead to legal proceedings being taken against you and an embargo on the property.
You will be responsible for the utility charges – electricity, gas, water sewerage, rubbish collection etc. from the time that you buy the property.
You should pay these otherwise the property can be confiscated and auctioned in order to settle the debt.
If you are non-resident you must declare any income you have earned in Cyprus. This applies even if you receive this income by renting out to people from your home country and the money never touches Cyprus.
You will also normally have to declare this income in the country where you are tax resident but can normally offset the tax paid in Cyprus through Double Taxation Treaties.
Tax residence in Cyprus
The taxes that you pay when you buy a property in Cyprus will normally depend on whether you are tax resident there or not.
You are likely to be considered tax resident in Cyprus if any of the following apply:
- You spend 183 days or more a year in Cyprus (not necessarily continuously)
- Your main home is in Cyprus
- Your immediate family (spouse and dependent children) are based in Cyprus
- Your main economic interest there?
If you do become tax resident in Cyprus, then you will normally stop paying taxes in your home country and start to pay taxes in your new country.
Do not be tempted to have selective amnesia when it comes to declaring taxes as the authorities in both Cyprus and the UK are clamping down on people who do not do things properly.
Sometimes you should declare something for tax purposes in one country and also in another. Cyprus and the UK have a Double Taxation Treaty which means that you don’t normally pay tax twice and can offset the tax paid in the other country against the tax that you would otherwise pay in your home country.
Need help with owning property in Cyprus?
Our UK-based team of property lawyers are highly experienced in helping clients who have bought or inherited property in Cyprus, including dealing with ongoing costs and legal issues involved in Cypriot property ownership.
With a thorough understanding of both UK and Cyprus law, we can provide clear, reliable legal guidance in plain English, giving you the confidence to deal effectively with any property you own in Cyprus.