Key Dates

• 30 June 2022 - 1st instalment of Special Defence Contribution (SDC) for foreign rents, dividends & bank interest

• 31 July 2022 - Final 2021 Cyprus tax return deadline

• 31 July 2022 - 1st instalment of 2022 temporary tax due between 1 - 31 July (subject to change)

• 31 December 2022 - 2nd instalment of SDC for foreign rents, dividends & bank interest

• 31 December 2022 - 2nd installment of 2022 temporary tax due between 1 - 31 December

Cyprus Tax Rates 2022

Income tax

Special Foreign pensions tax

There is a special foreigns pension tax for overseas pensions with a flat rate 5% tax applied to the pension income over €3,420.

This tax is optional, you either choose to have your overseas pensions taxed at this rate or the normal income tax rate (above), whichever results in the lower tax bill.

Should I pay the normal tax rate or special rate on my foreign pensions?

You can choose whether to pay the standard tax rate on your foreign pension(s), or the special tax rate. This is not an additional tax.

Your choice will depend on whichever option results in less tax.

Example 1

John has a UK state pension of €10,000 and a private UK pension of €5,000 per annum for a total income of €15,000.

John would chose to declare his pensions under the normal income tax rates as hit total income is below €19,500, of which all income is tax free.

Example 2

Jennifer has a UK state pension of €10,000 and a UK private pension of €20,000 for a total income of €30,000 per annum.

If she were to declare her income under the normal tax rate then her tax bill would be as follows:

If however she elected to have her foreign pensions taxed under the special foreign pensions tax rate of 5% her tax will would be as follows:

Jennifer would therefore elect to have her foreign pensions taxed under the special rate of 5%.

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