2026 Cyprus tax guide
Cyprus Tax Reform 2026: What Changed for Individuals?
Cyprus introduced important personal tax changes for 2026, including revised income tax bands, a higher tax-free threshold and changes to deductions and other areas that may affect an individual's final tax position.
This guide explains the main changes for individuals and shows how the new rules compare with 2025. Your actual tax position can depend on much more than the headline tax bands.
New to Cyprus? See how residence, non-dom status and foreign income may affect your position. Cyprus Tax Calculator for Expats.
Updated for the 2026 Cyprus tax reform • Last reviewed August 2026
2026 Cyprus Tax Reform at a Glance
€22,000
Tax-free income band for 2026
€72,000
35% income tax rate begins above this level
Revised
The income thresholds for the progressive rates changed for 2026
New / revised
Qualifying personal and family circumstances may affect taxable income
The headline bands are only part of the overall tax position. Deductions, exemptions, tax credits, special-rate income and personal circumstances may also affect the final result.
Cyprus Income Tax Bands: 2025 vs 2026
| 2025 taxable income | Rate | 2026 taxable income | Rate |
|---|---|---|---|
| €0 – €19,5002025 band | 0% | €0 – €22,0002026 band | 0% |
| €19,501 – €28,0002025 band | 20% | €22,001 – €32,0002026 band | 20% |
| €28,001 – €36,3002025 band | 25% | €32,001 – €42,0002026 band | 25% |
| €36,301 – €60,0002025 band | 30% | €42,001 – €72,0002026 band | 30% |
| Over €60,0002025 band | 35% | Over €72,0002026 band | 35% |
The percentages remain progressive. What changed for 2026 are the taxable income ranges to which those percentages apply.
You do not pay your highest rate on all of your income.
Each rate applies only to the portion of taxable income falling within that band. A person whose income reaches a higher band does not pay that highest percentage on every euro earned.
The Tax-Free Threshold Increased to €22,000
2025
€19,500
The 0% personal income-tax band extended to €19,500.
2026
€22,000
The first €22,000 of taxable income falls within the 0% income tax band before the progressive rates begin.
The threshold applies to taxable income, not automatically to gross income. Gross income and taxable income can differ because of applicable exemptions, deductions and other tax rules.
Example: €50,000 Taxable Income
This simplified comparison assumes taxable income of €50,000, ordinary progressive tax bands only, and no additional deductions, credits or special-rate income.
2025 bands
2026 bands
Difference in this simplified example
€985 lower under the 2026 bands
This example isolates the effect of the ordinary income-tax bands only. An individual's actual 2025-to-2026 difference may be higher or lower because deductions, exemptions, credits, changes in income and other tax rules may also affect the result.
The Reform Is About More Than Tax Bands
CyTaxCalc's 2026 guided estimate also considers relevant deductions and reliefs already implemented in the signed-off application logic.
Family & Children
- Qualifying family-related deductions or reliefs
- Eligibility and income conditions may apply
Housing
- Qualifying housing-related expenditure where applicable
Energy & Green Expenditure
- Qualifying energy or green expenditure
- Subsidies may reduce the qualifying amount
- Carry-forward and limits follow the existing calculator logic
Electric Vehicles
- Qualifying expenditure where applicable
Home Insurance
- Qualifying treatment where applicable under the existing 2026 logic
The calculator does not replace a review of the specific rules that apply to your circumstances. It uses the existing signed-off logic and flags uncertainty where professional review may be appropriate.
Employment Reliefs Can Still Affect the Result
Headline tax bands do not necessarily apply directly to gross salary. CyTaxCalc may consider relevant qualifying first-employment reliefs and other employment-related treatment already implemented in the calculator.
Where eligibility is uncertain, the estimate can flag the matter for professional review rather than presenting an assumption as a final conclusion.
Tax Residence and Domicile Still Matter
The 2026 reform does not make tax residence and domicile interchangeable. Tax residence can affect the scope of income potentially subject to Cyprus taxation, while domicile status can affect the treatment of certain passive income.
CyTaxCalc asks about residence and domicile separately and flags uncertainty where professional review may be appropriate.
Rental Income, Interest and Dividends
The ordinary income-tax bands do not tell the whole story for passive income. Depending on the income category and the individual's residence or domicile position, separate rules may apply to:
At a high level, the 2026 reform includes changes affecting SDC treatment, including abolition of SDC on rental income from 1 January 2026 and a 5% dividend SDC rate for relevant 2026 distributions. The applicable result depends on the income and circumstances entered into the estimate.
Pension Income May Have Special Tax Treatment
Certain pension income may be subject to alternative or special tax treatment rather than simply being combined with ordinary income. The result can depend on the type and source of pension income, so not all pension income receives identical treatment.
Does the 2026 Reform Mean Everyone Pays Less Tax?
Not necessarily.
The revised bands can reduce ordinary income tax at the same level of taxable income, but an individual's overall position depends on actual income, deductions, exemptions, credits and other relevant rules. Changes in income between years can also make simple year-to-year comparisons misleading.
The most useful comparison is your own position, not a generic example.
Who May Be Affected by the 2026 Changes?
Being in one of these categories does not mean everyone benefits. The effect depends on the person's income and circumstances.
Understanding the Reform in Your Own Circumstances
General tax tables cannot address every personal situation.
CyTaxCalc is designed to make the 2026 personal tax rules easier to understand while identifying situations where professional judgement may be appropriate.
CyTaxCalc is provided by A.P. Elympus Audit Ltd. It is an independent tax-estimation and guidance tool, not an official service of the Cyprus Tax Department, and it does not replace personalised tax advice.
Cyprus Tax Reform 2026 — Frequently Asked Questions
What is the Cyprus tax-free threshold for 2026?
What are the Cyprus income tax rates for 2026?
How are the 2026 bands different from 2025?
Did the tax percentages themselves change?
Is €22,000 based on gross salary?
Does everyone benefit equally from the reform?
Can CyTaxCalc help me estimate the effect?
Is CyTaxCalc part of the Cyprus Tax Department?
Sources and further information
Tax rates and reform information should be read together with applicable Cyprus tax legislation and Tax Department guidance. These external sources are provided for reference and do not imply any affiliation with CyTaxCalc.