Cyprus Expat Answers

What is the 5% VAT rule for first homes in Cyprus?

Short answer

Cyprus may allow a reduced 5% VAT rate for an eligible primary residence, instead of the standard 19% VAT rate. This can be valuable, but the rules include limits and conditions.

Main explanation

The Cyprus government provides a VAT 5% calculation tool for the purchase or building of a residence.

The 5% rate normally depends on using the home as your main and permanent residence, plus size, value, and application requirements.

Watch out

The 5% rate is not simply first property equals 5% VAT. Check the conditions carefully.

Useful next step

Ask your lawyer and accountant to confirm eligibility before relying on the reduced rate.

Need help with your own situation?

This page gives general information only. Cyprus rules can depend on your residence, income type, documents, timing, and family situation. A personalised check may be useful before making decisions.

Request Personal Help

This page is general information only and is not tax, legal, immigration, financial, or investment advice. Cyprus tax rules and contribution rules can change, and your personal situation may be different. Always check with a qualified adviser before making important decisions.