New Tax Regime for the relocation of high earning employees in Cyprus
The Minister of Finance of the Republic of Cyprus, Costantinos Petrides, has announced today that the Council of Ministers has approved today a Bill of Law setting forward an attractive tax regime for the relocation of high earning employees in Cyprus.
The Bill of Law provides for a 50% tax exemption for employees earning more than EURO 55,000 per year. In addition, the regime will be applicable to the employee for a period of 17 years from the date of commencement of employment. (as opposed to the current 10 years).
The tax benefits of the new Bill will also be applicable to existing employees who have already relocated to Cyprus.
A grace period of 2 years is also given to new employees earning less than EURO 55,000 in order to meet the requirements of the tax exemption. A grace period of 6 months is also given to existing employees.
Importantly the spouses of the employees will also have the right to move to Cyprus with a right to work.
The above-mentioned Bill is part of the Government’s Action plan/strategy for attracting companies to activate or expand their activities in Cyprus.
We have already seen in practice increased interest in the relocation of employees in Cyprus and we expect much more interest when these amendments will enter into force.
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