Buying property in Cyprus
All you need to know about the process and how we can help you along the way
The perfect home
The process of purchasing property in Cyprus is very simple. The Cybarco team will be with you every step of the way, assisting you with any queries and offering support through to completion.
- Permanent residence permit in Cyprus
Non-EU citizens who purchase property in Cyprus can benefit from a new and accelerated procedure for obtaining a Permanent Residence Permit.
The parents (his and or her spouse’s) of Permanent Residency holders or future applicants can also apply for a permit.
The applicants must:
- Submit the application accompanied with a title deed or contract of sale (submitted to the Department of Lands and Surveys) for a property purchased in Cyprus of a minimum value of €300,000 and proof of payment for at least €200,000.
- Prove that they have at their disposal a minimum annual income of €30,000 transferred from overseas.
The amount requirement increases by:
– €5,000 for each dependent child.
– €8,000 for each dependent parent (applicant’s or spouse’s).
- Submit a letter from a Cypriot Bank confirming they have deposited an amount of minimum €30,000, to be deposited in the account for three consecutive years. The amount should be sourced from overseas. The amount must be transferred to Cyprus from abroad.
- Submit a clean criminal record certificate issued by the Authorities of their country of origin.
- Submit a statement confirming they will not be working or be engaged in any form of business in Cyprus.
- Visit Cyprus at least once every two years.
Provided that the criteria described above are fulfilled, the application shall be examined by the Minister of the Interior and the permit shall be granted within 1-2 months.
Given this new procedure and the savings of thousands of Euros due to the abolition of transfer fees, now is the best time to buy property in Cyprus.
- Permission to buy in Cyprus
Cypriots and EU citizens can buy as much land or property as they wish, without restriction and without needing permission.
Non-EU citizens are entitled to freehold ownership of properties, while offshore entities may buy premises for their business or as a residence for their foreign employees. Permission to buy property must be sought from the Council of Ministers by written application, submitted by the purchaser after the agreement is signed. This permission is granted more or less as a matter of course to all bona fide purchasers. In the meantime, however, purchasers may take possession of their property without restriction. The application to the Council of Ministers to acquire immovable property in Cyprus can be made within a reasonable amount of time after signing the contract of sale.
- Contract of sale
The legal system in Cyprus is based on the British system. When purchasing a property the contract you sign is a private agreement between you and Cybarco. All contracts of sale are in English, but we can provide you with an official translation in any language you require.
- Legal Advice
Typically, fees for advice on the contract of sale from an experienced property advocate range between €1,200 and €3,400, payable on signing the contract. If you do not have an advocate, we can refer you to a number of respected and experienced professionals.
- Payment terms
Payment terms are specified on each of our project’s price list and vary according to the type of development and stage completion of each project. Once you have selected the project(s) in which you are interested, please call any of our offices or send an e-mail to us and we will forward all relevant information on the development(s) you have highlighted.
- Filing the contract of sale to the Land Registry Department
Once the contract of sale is signed and stamped, Cybarco, or your lawyer, files within six (6) months a certified copy of the contract at the Land Registry Department to ensure the transfer of the acquired property into your name.
Specific Performance Law safeguards a purchaser of immovable property from a transaction between a seller and a purchaser, especially when the purchaser is not allowed to immediately transfer the acquired property into his/her name even though payment of the consideration has been made. Depositing a copy of the contract to the Land Registry gives the purchaser, according to the above law, the right to seek “specific performance” of the terms and conditions of the contract and thus to register the property into the purchaser’s name. The contract of sale deposited with the Land Registry can be withdrawn only with your consent.
The Cyprus Department of Land and Surveys is the oldest governmental department of the public sector, established in 1858. Through the years it has been updated, making it one of the most sophisticated land registry systems in the world. Therefore, purchasing a property in Cyprus, is a very straightforward procedure.
- Stamp duty Cyprus
In the case of a sales contract, you, as the purchaser, are liable for the payment of Stamp Duty at the rate of:
Value Rate The first €5,000 0 €5,001 – €170,000 0.15% More than €170,000 0.2%
- Cyprus VAT payable on property
Since Cyprus’ EU accession in 2004, a standard VAT rate of 19% is required to be paid when buying a new property.
However, following a recent VAT Amendment Law, a reduced VAT rate, starting from 5%, is applicable for the acquisition of new residential properties.
For the reduced rate to be in effect, certain terms and conditions must be met:
- The property must be used as the primary and permanent residence of the applicant (for the next ten years).
- The applicant has not acquired any other residence in Cyprus with a reduced VAT rate.
- The applicant must be an individual, over 18 years old, thus legal entities are excluded.
The reduced VAT rate of 5% is applied on the first 200 square meters (building coefficient) of the property as per the architectural plans submitted to the Authorities. On the remaining square meters, the standard rate of 19% is imposed.
- Annual property taxes and fees in Cyprus
Immovable Property Ownership Tax
Immovable Property Tax has been abolished as of the 1st of January 2017.
Local Authority Fees
Depending on the size of your property, local authorities charge between €85 – €500 per annum for regular refuse collection, street lighting, sewerage and similar community services. Communal Services fees are payable to your local municipal authority.
As the registered owner of the property, you are required to pay an annual Municipality Tax, calculated on the market value of the property as at 1st of January 2013. Rates vary from 1‰ – 2‰. Municipality tax is payable to your local municipal authority.
As the registered owner of the property, you are required to pay an annual Sewerage Tax, calculated on the market value of the property as at 1st of January 2013. Rates vary from 0.5‰ – 3‰. Sewerage taxes are payable annually to your local sewerage board.
- Title deeds Cyprus
Transfer of ownership from Vendor to Purchaser is a simple procedure undertaken through the Cyprus Land Registry Office, either by the buyer in person or by appointing a third party with a power of attorney. By purchasing your property from Cybarco, you are guaranteed your Property’s Title Deed.
When the Title Deeds are issued, (a few years after the completion of the project / property) they are always in the name of the Developer (Cybarco), and then Cybarco transfers the Title Deed of each unit in the name of the purchaser. From the minute your Contract of Sale is deposited at the Land Registry Department, you the purchaser can prevent the owner/developer from transferring the property elsewhere or changing it. Furthermore, no burdens, charges or encumbrances can affect your right to seek specific performance after the contract has been deposited with the Land Registry, since you are the beneficial owner.
- Property transfer fees
The fees charged by the Department of Land and Surveys for the transfer of immovable property are:
Property Price Rate Fee Accumulated Fee First €85,000 3% €2,550 €2,550 €85,001 – €170,000 5% €4,250 €6,800 Over €170,000 8%
Properties subject to VAT are exempt from the above transfer fees.
Properties not subject to VAT are eligible for a 50% exemption from the above transfer fees.
For more information, feel free to contact us.
- Capital Gains Tax
Capital Gains Tax at the rate of 20% is imposed on the profit gained from the disposal of a property.
- Inheritance Tax
In Cyprus there is no Inheritance Tax, as it was abolished in 2000.