VAT or Transfer Fees — Not Both
When buying property in Cyprus, you will pay either VAT (19%) or Transfer Fees, depending on whether the property is a new build from a developer or a resale property. You don't pay both on the same transaction.
When VAT Applies (New Builds)
New residential properties sold by a VAT-registered developer are subject to 19% VAT. However, a reduced 5% VAT rate applies to the first 130m² of a new property purchased as a primary residence, provided the buyer:
- Is an EU citizen or legally resident in Cyprus
- Has not previously benefited from the reduced VAT rate
- Intends to use the property as their primary and permanent residence
- Will live in the property for at least 10 years
The 5% rate applies to the first 130m² and 19% applies to the remaining area beyond 130m².
Transfer Fees (Resale Properties)
For resale properties (those that have previously been transferred), transfer fees are calculated on the market value of the property at the time of transfer:
- First €85,430: 3%
- €85,431 – €170,860: 5%
- Over €170,860: 8%
These rates are charged on the Department of Lands and Surveys' assessed value, which may differ from the agreed purchase price.
Stamp Duty
All property contracts must be stamped. Stamp duty rates in Cyprus:
- First €5,000: 0%
- €5,001 – €170,000: 0.15%
- Over €170,000: 0.20%
- Maximum cap: €20,000 per contract
Capital Gains Tax
Sellers pay Capital Gains Tax (CGT) of 20% on gains from the disposal of Cyprus immovable property. Several exemptions apply, including a lifetime exemption on the sale of a primary residence (up to €85,430).