In Cyprus, capital gains typically arise from the disposal of assets such as real estate, stocks, bonds, and other investments. Capital gains are generally calculated as the difference between the selling price of the asset and its acquisition cost. Distinctions may be made between short-term capital gains (assets held for less than one year) and long-term capital gains (assets held for more than one year).
Taxable capital gains in Cyprus are calculated by subtracting the acquisition cost of the asset from the selling price. Any expenses related to the sale or acquisition, such as brokerage fees or legal fees, may be deducted from the gain. Additionally, any improvements made to the property may also be factored into the calculation.
As of the last available information, capital gains tax in Cyprus is generally levied at the same rates as income tax. For individuals, the tax rates on capital gains are progressive, ranging from 0% to 35%, depending on the total taxable income and the nature of the gain. However, certain categories of capital gains may be subject to specific tax rates or exemptions.
Legal References:
- The main legislation governing capital gains tax in Cyprus is the Income Tax Law (Law 118(I)/2002) and subsequent amendments.
- Articles 5 and 6 of the Income Tax Law outline the treatment of capital gains and the calculation of taxable income.
- Article 4 of the Income Tax Law specifies the tax rates applicable to capital gains.
