Tax incentives for the employment of foreign individuals

In order to attract foreign employees to work in Cyprus, law was passed in 2012 giving various tax incentives up to 31 December 2020 for foreign individuals. These stated that the lower of €8.550 or 20% of the remuneration from any employment exercised in Cyprus by an individual who was resident outside Cyprus the tax year before the year of commencement of employment in Cyprus is exempt from income tax.

This exemption was recently voted by the Cyprus government to continue to apply for a further five-year period and is available to qualifying individuals commencing employment up to 2025. It is clarified that the exemption is provided in the five years that follow the year of commencing employment.