50% deduction on income tax
An individual with annual income of over €100.000, and whose residence was previously out of Cyprus and is now employed in the country, is entitled for 50% tax deduction on his income. This deduction refers to income deriving from Cyprus and is valid for the next 10 years starting on the day of his employment in the republic.
Example table: Annual income of €100.000
The below Table 1 demonstrates the tax that would be applied on income of €100.000 without any deduction. The Table 2 demonstrates the same amount with the deduction applied.
Table 1
| Salaried Tax Scale | Tax Rate | Tax Scale on €100.000 excluding deduction |
|---|---|---|
| € | % | € |
| Up to 19.500 | Zero | Zero |
| From 19.501- 28.000 | 20 | 1.700 |
| From 28.001 - 36.300 | 25 | 3.775 |
| From 36.201 - 60.000 | 30 | 10.885 |
| From 60.001 – 100.000 | 35 | 14.000 |
| Total | 30.360 |
Table 2
| Salaried Tax Scale | Tax Rate | Tax rate on €100.000 with 50% deduction |
|---|---|---|
| € | % | € |
| Up to 19.500 | Zero | Zero |
| From 19.501 - 28.000 | 20 | 1.700 |
| From 28.001 - 36.300 | 25 | 3.775 |
| From 36.201 - 50.000 | 30 | 4.140 |
| Total | 9.615 |
To conclude, the person with income of €100.000 would be taxed with €9.615 or 9,62%.
The advisory team of KTC is always available and ready to assist you on any procedure and preparation of the yearly tax return.
