According to the Cyprus Tax Office circular, EE 33 of the 29th January 2019, there is now further guidance and clarity to the Law 119(I)/2017 which regulates the 60-day tax residence rule for individuals. The Law provides that individuals, as of the beginning of 2017, who are present in Cyprus for one or more periods within a tax year equalling to a minimum of 60 days, shall be deemed to be tax resident of Cyprus for the relevant tax year, as long as they meet all of the following criteria:
- Do not remain in another country in excess of 183 days in total within the financial year;
- are not tax residents of another country;
- to have a permanent residence in Cyprus; and
- to have a business in Cyprus, an employment or hold a position (i.e. director) in a Cypriot tax-resident company throughout the tax year.
The circular clarifies that where an individual is appointed as a director in a Cyprus tax-resident company and delegates this position to an alternate director at any time within the tax year, will not qualify for the Cypriot tax residence under the 60 days rule due to not complying with the 4th criterion mentioned hereinabove.
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