Tax in Cyprus for people moving from the UK
Last verified 24 August 2026
Half the people who move to Cyprus from the UK move at least partly for the tax, and the headlines are real: a 5% rate on pensions, dividends free of income tax for non-doms, no inheritance tax. What the headlines skip is the small print that decides whether those numbers apply to you. This page explains the system as it stood when last verified, for the south, where the famous regime lives, with a note on the north at the end. It is information, not advice; tax is personal enough that anyone moving should buy an hour with a Cyprus tax adviser before relying on any of it.
Becoming tax resident: 183 days, or 60
The classic route is simple: spend more than 183 days in Cyprus in a calendar year and you are tax resident. The interesting route is the 60-day rule, designed for internationally mobile people: spend at least 60 days in Cyprus, no more than 183 in any other single country, hold no tax residence elsewhere, keep a permanent home on the island, and maintain a business, employment or directorship tie in Cyprus. Meet all of that and Cyprus will claim you after just two months’ presence, which for the right person is one of the more useful arrangements in Europe. Note that immigration residence and tax residence are separate tests; the residence permits guide covers the other half.
Non-dom: the engine of the regime
New arrivals who have not been Cyprus tax resident for 17 of the last 20 years qualify as non-domiciled, and non-dom status is where the appeal concentrates: dividend and interest income escapes the defence levy that domiciled Cypriots pay, for up to 17 years. For a UK investor or company owner, that is dividends received essentially free of Cyprus income tax, subject to the GESY health contribution of 2.65% on income, which applies to residents across the board and is capped. Income tax on ordinary earnings runs through progressive bands, with nothing due on roughly the first €22,000 and a top rate of 35%.
Pensions: the 5% rate, honestly stated
Foreign pension income can be taxed at a flat 5% above a small exempt amount, elected year by year against the alternative of the normal bands, and for most UK retirees the flat rate wins. Two honest footnotes. First, GESY’s 2.65% rides on top, so the real rate is nearer 7.5% than 5%, still excellent, but not the number in the adverts. Second, the 5% election does not cover everything: under the UK double tax treaty, government service pensions, civil service, military, police, most teachers, stay taxable in the UK unless you become both resident and a Cypriot national. The state pension, by contrast, qualifies for the 5% route and keeps its annual uprating in Cyprus under the UK social security arrangements, which is more than can be said for several retirement destinations.
Inheritance: no Cypriot tax, two catches
Cyprus abolished inheritance tax entirely, which sounds like the end of the story and is not. Catch one: the UK can still tax your estate. Since the 2025 reforms UK inheritance tax follows long-term residence, and it lets go slowly, with a tail of years after you leave, so moving to Cyprus does not switch it off on arrival. Catch two: Cypriot succession law includes forced heirship, rules that reserve part of your estate for children and spouse regardless of what your will says, and they can bite on assets here. Both catches are exactly what a proper adviser is for, and we will cover wills and inheritance in their own guide.
The north: a different system entirely
None of the above applies north of the line. The north runs its own tax regime in Turkish lira, has no double tax treaty with the UK, and its arrangements for foreign residents are a matter of local rules and practice rather than treaty rights. People living in the north on UK income generally remain within the UK’s tax net for that income, and anyone contemplating the move should take advice from a practitioner who knows the northern system specifically, because very little written for “Cyprus” online is written about the north. As with residency, time spent in the north builds no position in the south’s system.
The short version
South: become resident by 183 days or the 60-day rule, claim non-dom, take pensions at 5% plus GESY, and plan properly around UK inheritance tax and forced heirship before assuming “no inheritance tax” means what it seems to. North: assume nothing transfers, and take local advice. Both sides: this page went out of date the day after we verified it, so check the current numbers before you act on them.