The cabinet of Ministers approved on Tuesday 11 May 2022 a competitive tax incentive scheme with an aim to attract foreign companies and high quality employees.
Main target
Draw interest from technology companies and to promote the technology sector in Cyprus. This scheme is aimed to both foreign employees relocating to Cyprus and also repatriates Cypriots that currently are employed and living abroad.
The scheme
50% tax break for employees earning an annual income of above €55,000.
Time period
Tax break will be extended from the current period of 10 years to 17 years. Time period begins on the 1st year of employment of the employee in Cyprus.
Grace period
There is a distinction between existing employees and new employees. An individual that is already employed in Cyprus has a grace period of 6 months to meet the prerequisites of the scheme, while new employees have a grace period of 2 years. A prerequisite in this case refers to the minimum annual income of €55,000.
Future
The Minister of Finance, Mr Constantinos Petridis, stated that he is confident that this scheme is one of the most competitive ones of its kind in the European Union. The Minister also stated that additional measures are expected to be implemented in the near future that will provide even more incentives. One of the main aims is to also ensure an easy and quick process for spouses of the employees to obtain a residence permit and join the Cyprus workforce as well.
