If you’re considering Cyprus for its attractive non-domicile tax regime, it’s essential to understand the specific rules and requirements that allow you to qualify. The non-dom program offers unparalleled tax benefits, but meeting the criteria is key to unlocking these advantages.
In this guide, we’ll break down the residency rules, including the 183-day rule, the 60-day rule, and other critical requirements you need to fulfill to achieve non-dom status. Whether you’re an entrepreneur, a digital nomad, or simply exploring your options, this article provides everything you need to know to navigate the process confidently.
For a broader explanation of non-dom status and its tax benefits, check out our Ultimate Guide to Cyprus Non-Domicile Tax Residency Status Non-Dom Service page
What Are the Rules to Qualify for Cyprus Non-Dom Status? To benefit from Cyprus’s non-dom tax regime, you must meet specific residency and economic criteria. Below, we outline each requirement in detail to help you understand how to qualify.
The 183-Day Rule The first step to qualify for non-dom status in Cyprus is to establish tax residency, which can be achieved under the 183-day or 60-day rule. The 183-day rule is the traditional residency requirement in Cyprus. To qualify as a tax resident under this rule, you must spend at least 183 days in Cyprus during the calendar year. This straightforward approach ensures that individuals who make Cyprus their primary place of residence are eligible for the non-dom benefits.
The 60-Day Rule Alternatively, if you cannot commit to 183 days in Cyprus, the 60-day rule provides a more flexible alternative. Under this rule, you can qualify for tax residency by spending a minimum of 60 days in Cyprus, provided that:
You are not a tax resident of any other country during the same calendar year, meaning you have not spent 183 days or more in another country or have formally deregistered as a tax resident elsewhere. You maintain strong economic or professional ties to Cyprus, such as setting up a company with you as the director, or working for a Cyprus-based business. You reside in Cyprus for at least 60 days and do not exceed 183 days in any other country within the calendar year. The 60-day rule is particularly beneficial for entrepreneurs, digital nomads, and high-net-worth individuals who want to optimize their tax position without committing to extended periods of physical presence in one country. However, the 60 days is just the minimum requirement, as you and your family are free to live in Cyprus year-round while still enjoying all the benefits the non-dom regime provides. The first step, however, is to qualify for residency under either the 183-day or 60-day rule.
Economic or Professional Ties One of the key requirements for non-dom status is demonstrating strong economic ties to Cyprus. This can be achieved by carrying out business activities, working in Cyprus, or being a director of a Cyprus tax-resident company, such as your own freelance or holding company. Establishing these ties not only fulfills the eligibility criteria but also underscores your commitment to contributing to the local economy. Setting up a company in Cyprus is by far the easiest way to meet this requirement. If you’re interested in exploring this option, our Cyprus Company Formation Services
Non-Domiciled History Requirement To qualify as a non-dom, you must not have been living in Cyprus for at least 17 of the last 20 years. This rule ensures that the program is designed for individuals who are genuinely relocating or establishing new ties to Cyprus rather than those with long-standing domicile status in the country. This applies equally to Cypriots and foreigners, offering returning Cypriots who have lived abroad the same opportunities to benefit from the non-dom regime.
Accommodation Requirement Having suitable accommodation in Cyprus is another critical requirement. This can be achieved by either renting or owning a property. If you opt to rent, the lease must be for at least 12 months and your rental agreement must be certified by local authorities. The accommodation serves as a tangible indication of your intent to reside in Cyprus, even if your physical presence is limited.
No Other Tax Residency Finally, to qualify for non-dom status in Cyprus, you must not hold tax residency in any other country during the same calendar year. This means you cannot spend 183 days or more in another country, making you a tax resident there. You will therefore need to formally deregister as a tax resident in your current country of residence. This rule is essential to prevent conflicts with other jurisdictions and to ensure your eligibility for the tax benefits offered by Cyprus's non dom regime. It’s crucial to plan your residency carefully to meet this condition and avoid issues with double taxation.
Conclusion Understanding the rules and requirements for non-dom status in Cyprus is vital for anyone looking to benefit from the country’s tax advantages. From meeting the 183-day or 60-day rule to establishing economic ties and securing suitable accommodation, each criterion plays a critical role in your eligibility. By fulfilling these requirements, you can unlock significant tax savings while enjoying the Mediterranean lifestyle that Cyprus offers.
If you’re ready to take the next step, learn more about how we can assist you in navigating the process on our Non-Dom Service
