Cyprus remains one of the most attractive jurisdictions for property investment. The island benefits from a stable legal system and transparent rules governing transactions. For buyers, it is crucial to understand in advance which taxes and fees will apply.
VAT on New Builds
- Standard rate — 19%
Applied when purchasing new property (off-plan or newly completed).
Source: Ministry of Finance — Tax Department (VAT rates) - Reduced rate — 5%
May apply when purchasing or constructing a dwelling intended as the buyer’s first and permanent residence. The eligibility criteria are set out in Circular 11/2023 of the Tax Department, including property size and overall value.
Source: Tax Department Circulars (official page)
Legislation and circulars further stipulate that if these conditions are not met (for example, if the dwelling ceases to be used as the buyer’s permanent residence within 10 years), the tax authorities may demand repayment of part of the benefit.
Source: PwC Cyprus – VAT on First Residence (summary of Circular 11/2023)
Transfer Fees
- When applicable: only in transactions on the secondary market (resale).
- Calculator: available on the official portal of the Department of Lands and Surveys (DLS) – Transfer Fees Calculator.
- Special provisions:
- If VAT has been paid on the transaction — no transfer fees are charged.
- If VAT has not been paid — a 50% reduction on transfer fees applies.
Source: DLS – Rights and Fees (official document, PDF)
Title Deeds and the Search Certificate
- Legal framework: the issuance and registration of property ownership is governed by Cap. 224 — Immovable Property (Tenure, Registration and Valuation) Law.
Source: DLS Portal – FAQs - Search Certificate: issued upon submission of Form N50 at the district land offices or via the official DLS portal. This is the key document for verifying whether a property carries encumbrances, mortgages, or court claims.
Source: DLS Portal – FAQs
Conclusion
The structure of property-related costs in Cyprus is straightforward:
- for new builds, VAT (19% or 5% under qualifying conditions) is decisive;
- for resales, transfer fees apply, which can be calculated using the official tool;
- verifying the property through its Title Deed and obtaining a Search Certificate is essential to avoid risks.
Following these rules and relying on official sources is the foundation of a secure transaction in the Cypriot property market.
