Who Is Eligible
Cyprus allows dual citizenship for people of any origin. However, you should double-check your homeland's laws.
Over 50 countries don't support dual nationality — such as China, India, Japan, Monaco, Norway and the UAE. Then, you'll be required to renounce your old passport to obtain the Cyprus one.
Otherwise, you might be able to keep both passports. For instance, you can be a UK and Cyprus citizen simultaneously.
How to Get Cyprus Dual Citizenship in Exchange for Investment
In 2020, this island state closed the program that enabled foreigners to get citizenship relatively quickly and easily. The key shortcoming of that program was its price. Expats had to invest at least €2 million in the local economy.
Today, the investment threshold is lower. On the flip side, foreigners have to wait longer to be able to apply for citizenship. Before that, they can enjoy the benefits of being Cyprus residents.
There are 3 investment options to choose from:
- The most common and straightforward one is to purchase real estate on the island. It can be brand new or second-hand property. You have the right to buy one or two properties. It doesn't matter whether they're residential or commercial.
- The second way out is to buy shares of local companies. They should generate profit on the island and have a staff of at least 5 professionals.
- The third alternative is to purchase units of local funds. Only selected funds qualify for the program, so please consult a legal advisor in advance.
No matter which option you prefer, be ready to spend at least €300,000.
Your dearest and nearest can apply together with you. There are no specific requirements for your spouse. Your kids can apply with you if they tick one of these boxes:
- Are aged younger than 18
- Are aged younger than 25, are single, keep studying in a higher education establishment and can't sustain themselves without your financial support
- Are disadvantaged either mentally or physically, regardless of their age
Temporary residential permits are subject to renewals. But you'll get a permanent one, which means you won't need to renew it. Just make sure to visit Cyprus once every two years. In 5 years, permanent residents can apply for citizenship. Foreigners who qualify for naturalization without investment have to wait for 7 years. These can be, for example, expats who relocate to the island to work. Citizenship by investment remains a faster route.
In most states, you'll become a local tax resident if you spend at least 183 days per year in the country. In Cyprus, the minimum required limit is 60 days per year. However, you won't be allowed to spend over 183 days annually in any other country. You should split your time between several states. Besides, you can't be a tax resident of any other territory. It's also crucial to own real estate in Cyprus and carry out economic activities there (such as run a business or work as an employed professional).
After you become the island's tax resident, you'll remain a non-domiciled individual for 17 years. This status will grant you some benefits that we're about to discuss.
As a resident, be ready to pay the tax on the income that you generate anywhere in the world. As a non-resident, you'll pay the tax only on the income that you generate in Cyprus. These rules apply both to individuals and legal entities.
If you become a Cyprus resident, the tax rate for your income as an individual will depend on how much you earn. If you make less than €19,500 annually, you don't pay any tax. The highest rate is 35% and it applies to those who earn over €60,000 annually.
Non-domiciled professionals who work on the island and earn over €100,000 annually pay the tax only on half of their income for 10 years.
Non-domiciled retirees whose foreign pension exceeds €3,420 per month pay a 5% tax on it.
When investing in real estate in Cyprus, be ready to pay these taxes:
- If you're buying a property on the island for your own usage, you'll need to pay a VAT of 5%. If you aren't planning to live there yourself, the amount of VAT will increase to 19%. Those who pay VAT get a 50% discount for stamp duty and are exempt from the transfer fee.
- The amount of transfer tax depends on the market price of the chosen property. If this price doesn't exceed €5,000, the tax isn't charged. If the price exceeds €170,000, the amount of the tax reaches its maximum of 8%. Please mind that the market price of the property doesn't always equal the price that you actually pay for it. It's the authorities who determine the former.
- The amount of stamp duty depends on the purchase price of the property. For the initial €5,000, stamp duty isn't charged. Then, it becomes 0.15%. For the part of the price that exceeds €170,000, the amount of stamp duty is 0.2%.
- The authorities of the municipality where the property is located will determine the amount of service taxes.
- When reselling your property, you might need to pay a 20% capital gains tax. It's relevant only for properties whose disposal is exempt from income tax.
There are no taxes on wealth, inheritance and gifts.
Cyprus has a defense tax that many other countries lack. Its rate is 17% and it applies to the income that you make from interest, dividends and capital gains. It doesn't matter whether you earn this money in Cyprus or abroad. You'll be exempt from this tax as long as you aren't domiciled on the island, for a maximum of 17 years.
If you want your company to become a local tax resident, you should control or manage it from the island. Then, its corporate tax will be 12.5%, which is the lowest in the EU. If your business lacks the Cyprus resident status, you'll be exempt from this tax.
The standard VAT rate is 19%. It's charged on:
- Buying products from the EU
- Importing products to the island
- Providing services and selling goods on the island
The lowest VAT rate is 5%. It applies to real estate repairs and renovation. A VAT of 9% applies to selected business niches, such as hospitality, restaurants or catering.
Actually, there are more tax benefits for various types of businesses. For instance, shipping companies might be exempt from all taxation. Insurance companies can pay reduced taxes. Please consult an expert to find out about the details.
Over 50 states signed double taxation treaties with Cyprus. These include most European countries, the UK, the USA, Canada, China, India, Russia, Egypt, Seychelles, Qatar, Thailand, Kuwait, Singapore and South Africa. If you hold dual citizenship of one of these states, you'll have to pay your taxes either there or in Cyprus — but not in both territories.
Pros and Cons of Cyprus Citizenship
After you become a citizen of this island state, you should appreciate the following advantages of your decision:
- Freedom of travel. You won't need to get a visa in advance to visit around 180 countries in different regions of the planet.
- Opportunity to live and work anywhere in the EU. You and your kids will be able to easily relocate to any other EU country. It's not necessary to obtain any special permits. Most likely, you'll only need to visit a migration office or a police station to register upon arrival. You'll be allowed to stay wherever you wish for an unlimited time and get employed.
- Excellent business perspectives. After you launch a company in Cyprus, you'll be able to cater to the whole EU market. You'll benefit from the high paying capacity and developed infrastructure of this region.
- Affordable studying. EU universities charge high tuition fees for foreigners who arrive from outside of the region. Locals pay less or even study for free. You or your kids will be able to choose from over 1,000 universities.
- Affordable healthcare. You'll be able to receive free or affordable healthcare in any EU country. The quality of medical services will be top-notch.
- Right to vote. As a Cyprus citizen, you'll be allowed to vote in the elections of any level.
- Tax benefits. As we already told you, the island offers a lucrative taxation system for both its residents and non-residents. You should be able to make the most of it as a citizen.
- Less bureaucracy. The process of purchasing real estate anywhere in the EU is faster and easier for local citizens. Buyers from outside the EU have to collect more documents, pay higher fees and wait longer. It might be more difficult for them to get a mortgage and its conditions might be not too favorable.
- Inheritance. As you already know, your kids can apply for Cyprus citizenship together with you. If you give birth to kids after you become a local citizen, they will automatically become Cypriots by descent. When you get grandkids, get married or get new family members in any other way, it won't be a problem for them to get local citizenship as well. It will require only minimal paperwork. The process of inheriting movable and immovable property is very straightforward.
- Safety. The island boasts a remarkably low crime rate. It's one of the safest places in Europe and in the world.
- Mild climate. On average, it rains only around 25 days per year here. Summer lasts nearly all year round. In winter, you can ski in the Troodos mountains because it gets properly cold and there is enough snow.
- Leisure. Cyprus is a world-famous tourist destination. Its nature is pristine, its culture is rich and its hospitality standards are very decent. It offers superb entertainment opportunities for people of all ages. You'll enjoy fresh fish and seafood as well as amazing wine. It's an ideal location for improving your physical and mental well-being.
The disadvantages of becoming a Cyprus citizen are not too numerous. First, you should have enough funds to invest. However, the expenses are rather reasonable, compared to similar programs in other countries. Second, applicants wait for 5 years to become citizens. Again, other EU states can make you wait for 7 or even 10 years. Third, the Cyprus lifestyle is rather relaxed. You shouldn't expect to find the hustle and bustle of metropolitan areas here. Your shopping opportunities might be limited, especially if you're a fan of luxury brands. In the colder months, there are not so many tourists and life becomes particularly calm. For many people, this third disadvantage is actually an advantage.
Applicants for citizenship should prepare the following papers:
- Two passport-style photos
- Marriage certificate
- Birth certificate
- Medical insurance
- Proof of having always been law-obedient
- Proof of having enough funds that the applicant earned legally (you should have a stable source of income and earn €50,000 or more annually)
- Proof of having accommodation on the island
The exact list might vary depending on your individual circumstances.
Is It Necessary to Learn Greek to Get a Cyprus Passport
When applying for residency, you won't have to prove that you know Greek. Over 70% of the island's population speak fluent English, so it shouldn't be a problem for you to express yourself.
When applying for citizenship, be ready to pass a Greek language test. Plus, the commission will ask you questions about the island's politics and social life. The exam doesn't seem too difficult for most foreigners.