Cyprus has emerged as a premier destination for businesses, offering generous Cyprus tax incentives to attract top-tier professionals from around the world. Through strategic Cyprus tax exemptions on salary income, Cyprus fosters a dynamic and inclusive environment.

This publication provides a detailed analysis of the 20% and 50% Cyprus tax exemptions available, highlighting the benefits and the eligibility conditions for qualifying professionals.

The 50% Tax Exemption: Attracting High-Income Earners

Cyprus is committed to drawing high-income earners through a 50% exemption on remuneration for individuals employed in Cyprus, provided their annual salary exceeds €55,000 (previously €100,000). This exemption is designed for those who have not been residents of Cyprus for at least 15 consecutive years immediately before their employment. It applies to both Cyprus-resident and non-resident employers.

Key Details:

  • Eligibility: Non-residents for 15 consecutive years before employment.
  • Duration: The exemption applies once in a lifetime for 17 years.
  • Transition Period: Those employed before January 1, 2022, may transition to the new exemption if:
    • They were eligible under previous provisions.
    • Initially employed between 2016 and 2021 with remuneration over €55,000.
    • Commenced employment with remuneration below €55,000 and exceeded €55,000 within six months from July 26, 2022.
  • First Employment Definition: The updated definition includes salaried services for resident or non-resident employers, excluding short-term work not exceeding 120 days in a tax year.

The 20% Tax Exemption: Supporting Broader Talent

Starting July 26, 2022, Cyprus introduced a new 20% income tax exemption with a maximum annual limit of €8,550. This exemption is aimed at individuals whose first employment in Cyprus commenced on or after this date and lasts for seven tax years.

Key Conditions:

  • Employment Location: Must be carried out within Cyprus.
  • Previous Residency: Individuals must not have been residents of Cyprus for at least three consecutive tax years immediately before starting their employment.
  • Previous Employment: Must have been employed outside Cyprus by a non-resident employer.

General Benefits and Conditions

Both the 20% and 50% exemptions offer significant advantages:

  • Residency Requirements: Neither the individual nor the employer needs to be a Cyprus tax resident.
  • Choice of Exemption: Individuals can claim only one exemption. Those not resident for 15 consecutive years and meeting the income criteria can claim the 50% exemption. The 20% exemption benefits those who do not meet the 50% criteria, providing a tax advantage for up to seven years.
  • Continuity of Benefits: Individuals not meeting the new 50% exemption conditions but eligible under previous exemptions can continue benefiting from the previous 50% or 20% exemptions for the remaining period.


Cyprus’s tax incentives are designed to make the island a premier destination for international professionals and expatriates. By offering substantial Cyprus tax breaks, Cyprus supports a thriving business environment and attracts top-tier talent. If you are a high-income earner or a professional considering relocation, Cyprus provides an exceptional opportunity to enjoy significant tax savings.

Act Now: Explore how you can benefit from Cyprus’s tax exemptions and take advantage of this strategic opportunity to enhance your career and financial well-being. For more information and to assess your eligibility, contact our team of experts today.

Contact details

Tel. +357 22 340000

Email: [email protected]

The authors expressly disclaim all and any liability and responsibility to any person, entity, or corporation who acts or fails to act as a consequence of any reliance upon the whole or any part of the contents of this publication.

Accordingly, no person, entity, or corporation should act or rely upon any matter or information as contained or implied within this publication without first obtaining advice from an appropriately qualified professional person or firm of advisors, and ensuring that such advice specifically relates to their particular circumstances.