The Council of Ministers approved a bill on 10 May 2022, effecting certain measures that were announced by the Ministry of Finance in October 2021 in relation to the new strategy for attracting foreign investments in Cyprus (for details click here).
This strategy aims to further boost the development of the technology sector, to enhance Cyprus’ position as a sustainable business and commercial centre, and to promote the island as a prime location for headquartering.
The bill provides for the reduction of the minimum required annual salary from €100,000 to €55,000 regarding the 50% tax exemption for taking up employment in Cyprus.
- For existing beneficiaries of the exemption (receiving at least €100,000 annual salaried income), the bill provides for the 50% tax exemption if the annual remuneration from employment exercised in Cyprus is at least €55,000, provided that prior to the commencement of their employment in Cyprus they were abroad for 12 consecutive years. A grace period of six months for obtaining the benefit is provided, and the exemption will apply for 17 years from the commencement of employment (currently the exemption applies for 10 years).
- For new employees, the bill provides for a 50% tax exemption on remuneration from employment exercised in Cyprus by an individual who was abroad for 12 consecutive years, while eligible persons should earn at least €55,000 per year. The grace period to obtain the benefit for new employees will be set at two years. Similarly to existing beneficiaries, the exemption will be provided for 17 years from the commencement of employment.
Furthermore, another bill is expected regarding the granting of visas and work permits to spouses of professionals who opt to relocate to Cyprus, and regarding the operation of a One-Stop-Shop.