Capital Gains Tax is levied at 20% on gains arising from the disposal of property by each individual person.The gain is reduced by an indexation allowance that takes into account the inflationery increase over the years the property was owned. Non-residents are only taxed when selling property situated in Cyprus. The following allowances are available to individuals:
The first €17,086 of gains arising from the first disposal of any property in Cyprus. The first €85,430 of gains arising from the disposal of a house used by the owner for his/her own habitation. This allowance can only be claimed once. An individual claiming a combination of the above allowances in only allowed a maximum allowance of €85,430.
Inheritance Tax has been abolished with effect 1 January 2000, and is no longer imposed.
Local Authority Tax
Property taxes levied by the local authorities are payable annually and may vary, depending on the size of the property. The tax covers the cost of garbage disposal, street lighting, etc.
Communal expenses cover an owner's share towards the cost of cleaning and maintaining a project's communal areas, gardens, swimming pool, management fees and repairs. These are payable at fixed intervals throughout the year and vary from development to development and from property to property.