What it's worth
Net pay per year in Cyprus, single, 2026, with the new tax bands. Social insurance and the GeSY health contribution are the same either way: they're charged on your full salary.
| Gross salary | Standard | 50% exempt | Difference | A month |
|---|---|---|---|---|
| €60,000 | €45,291 | €52,730 | +€7,439 | +€620 |
| €100,000 | €71,036 | €86,965 | +€15,929 | +€1,327 |
| €200,000 | €134,658 | €169,658 | +€35,000 | +€2,916 |
At €55,000 or less, the exemption is worth nothing that year. Just above it, half your salary is suddenly exempt, so a raise that takes you over €55,000 can be worth much more than the raise. Check your exact salary
Who qualifies
You can use the exemption if all of these are true:
- It's your first job in Cyprus, and it started on 1 January 2022 or later.
- You weren't resident in Cyprus for at least 15 years in a row before the job started (10 years if it started before 30 June 2023).
- Your pay from the job is over €55,000 a year. If it isn't in your first year, it can be in your second.
- You work as an employee. Changing employer later is allowed.
- Self-employed income, dividends and other income don't get the exemption.
People who already worked in Cyprus before 2022 can sometimes keep or move to the exemption, under transition rules for those who used the older 50% exemption (for pay over €100,000) or started between 2016 and 2021. Ask a tax adviser if that's you.
How long it lasts
Seventeen tax years, starting with the year your job starts. You can only use it once in your life. Example for a job that started in 2026:
The exemption is checked year by year. In a year your pay is €55,000 or less, you get no exemption for that year.
How to claim
There is no application to file and no approval to wait for.
- 1Give your employer form T.D.59, declaring the exemption. Your employer then takes it into account when withholding income tax each month (PAYE).
- 2Claim it again in your yearly income tax return. From 2026 every resident aged 25 to 70 must file one.
- 3File the return for 2026 by 31 July 2027. Keep proof of when you came to Cyprus and where you lived before.
What changes, what doesn't
- Half your salary is left out of income tax
- The other half is taxed on the normal bands: 0% up to €22,000, then 20% to 35%
- Your contributions can be deducted only up to a fifth of the taxed half
- Social insurance at 8.8% on your full salary, up to the yearly ceiling
- GeSY health contribution at 2.65% on your full salary
- You are a Cyprus tax resident and file a yearly return
The 20% exemption
If your pay is €55,000 or less, or you weren't away long enough, there is a smaller exemption. It can't be combined with the 50% one.
- Your first job in Cyprus started after 26 July 2022.
- Just before it, you weren't resident in Cyprus for at least 3 years in a row, and worked abroad for an employer outside Cyprus.
- 20% of your salary is exempt, up to €8,550 a year, for 7 tax years starting the year after your job starts.
Other benefits in Cyprus
- For former Cyprus residents who come back after at least 7 years away
- A job or business started from 2025 to 2030, with pay over €30,000
- 25% of the income exempt, up to €25,000 a year
- If you weren't born domiciled in Cyprus, you pay no special defence contribution on dividends and interest
- It lasts until you've been resident 17 of the last 20 years
- From 2026 it can be extended twice by 5 years, for €250,000 each time
None of these change your salary's tax beyond what's above. GeSY at 2.65% is still due on dividends, interest and rent.
Becoming tax resident
The exemption is for Cyprus tax residents. You are resident in a calendar year if either is true:
- You spend more than 183 days in Cyprus.
- You spend at least 60 days in Cyprus, no more than 183 days in any other single country, work or run a business in Cyprus (or direct a Cyprus company) for the whole rest of the year, and have a home there you own or rent.
The day you arrive counts as a day in Cyprus; the day you leave doesn't.
When it ends
From your 18th year you pay normal Cyprus income tax. At €100,000 that means €1,327 less a month.
Nothing has to be filed when it ends: your employer stops applying it, and your return no longer claims it.
See what you keep after the exemptionSources and limits
- Income Tax Law 118(I)/2002, art. 8(23A) and 8(21A) · CyLaw
- Law 244(I)/2025, the 2026 tax reform · Cyprus Tax Department
- Tax Department guidance on the 50% exemption · Cyprus Tax Department
- Social insurance ceiling for 2026 · Social Insurance Services
- General Healthcare System Law 89(I)/2001 · CyLaw
Information, not tax advice. The salary figures come from our Cyprus calculation, tested against cases built from PwC's and KPMG's 2026 summaries (computed, not yet checked against the Tax Department's examples). The 25% exemption and non-dom status are summarised, not calculated.