Personal Tax Deductions & Tax Benefits in Cyprus

Tax Deductions

• Social Insurance Contributions: Contributions made by individuals to the Social Insurance Fund are deductible from taxable income.
  • Article 8 of the Income Tax Law (Law 118(I)/2002).
• Health Insurance Premiums: Premiums paid for private health insurance are deductible.
  • Article 8 of the Income Tax Law.
• Pension Contributions: Contributions to approved pension schemes or provident funds are eligible for tax deduction.
  • Article 8 of the Income Tax Law.
• Donations to Approved Charities: Donations to approved charitable organizations are deductible, subject to certain limits.
  • Article 9A of the Income Tax Law.

Tax Benefits

• Tax Credits for Investment in Innovative Startups: Individuals investing in qualifying innovative startups may benefit from tax credits.
  • Startup Visa Scheme and Tax Incentives for Innovative Startups.
• Tax Exemption for Foreign Income of Non-Domiciled Individuals: Non-domiciled individuals may benefit from tax exemptions on certain types of foreign income.
  • Special Defence Contribution Law (Law 117(I)/2002).
• Tax Credits for Energy-Efficient Home Improvements: Individuals making energy-efficient improvements to their homes may qualify for tax credits.
  • Energy Efficiency Tax Credits Scheme.

These deductions and benefits are designed to incentivize behaviors such as saving for retirement, investing in innovative ventures, contributing to social welfare, and promoting energy efficiency. They aim to support taxpayers financially while also furthering broader societal goals such as economic development and environmental sustainability.