Amendment to the Individual Tax Residency Rulenetinfo
On 14 July 2017 the Cyprus Parliament voted to amend the individual tax residence rule, under which individuals can now be held to be tax resident even if they reside in Cyprus for less than 183 days.
Under the previous rule, an individual was held to be tax resident only if they resided in Cyprus for more than 183 days in the tax year. The amending legislation added a second test for an individual who resides in Cyprus for at least 60 days but fulfils further criteria. These are, namely, that the individual:
- does not reside in any other single state for a period greater than 183 days in aggregate, and
- is not tax resident in any other state, and
- carries out business in Cyprus and/or is employed in Cyprus and/or holds an office of a company tax resident in Cyprus in the tax year, provided this is not terminated during the tax year, and
owns or rents a permanent residential property in Cyprus in the tax year.
The legislation will be retroactively effective as of 1 January 2017.