Cyprus – Questionnaire 2008
Cyprus - Questionnaire 2008
European Taxation Report 2008
- The Questionnaire -
This is the questionnairefor the taxation report of the UIPI for 2008. It is the follow up of the taxation report of 2003. The aim is to give all national tax experts a useful view over Europe’s taxes concerning real estate. Please hand this questionnaire to a tax expert of your organisation and ask him or her to return this questionnaire as soon as possible via email to or via fax to +49-3020216577506. If you have any questions please do not hesitate to contact Kai Warnecke ( / +49-3020216506).
Important notice:
The questionnaire concerns all kinds of taxation, which are at least in one country related to real estate. Even if this is not the case in your country (for example the income tax is not applicable for rental income), please do answer all questions in order to allow us a complete view on the taxes in Europe. The questionnaires setup is based on typical taxation. If your answers do not fit in the space provided, please feel free to use an extra sheet of paper to describe the way of taxation in your country as detailed as possible.
For some questionnaires we have already filled in some of the questions or parts of them. If the answers provided are still correct, you may leave them unanswered and just fill in the empty ones. If the provided answers are wrong, please fill in the empty questionnaire.
Please be aware of the fact, that the President of the UIPI – Stratos Paradias – is happy to announce, that all tax experts, who answer this questionnaire until the 30thof April 2008, will automatically take part in a lottery: Three times two of bottles of delicious Greece Retsina-Wine are given away!
Contact information
ASSOCIATION / CyprusLand and Property Owners’ Association (KSIA)CONTACT PERSON / George Strovolides
ADDRESS / KEBEBuilding, 38 Grivas Digenis Avenue and 3 Deligiorgi Street. P.O. Box 21455, CY-1509 Nicosia, Cyprus
TELEPHONE NUMBER / +357 22889800
E-MAIL / – –
DATE OF COMPLETION / 13 January 2009
1. Income tax
1.1 Is income from real estate taxed the same way as income from other sources or differently?
AS INCOME / DIFFERENTLY / NO TAXATION1.2 Is the tax rate for income from real estate proportional (single rate) or progressive (tax scale)? Please fill in the rates and scales.
a) Individuals
PROPORTIONAL RATE: / %PROGRESSIVE RATES
INCOME BRACKETS / RATE
€0 – €19.500 / 0,00 %
€19.501 – €28.000 / 20,00 %
€28.001 – €36.300 / 25,00 %
In excess of €36.300 / 30,00 %
%
%
b) Companies
PROPORTIONAL RATE: / 10 %PROGRESSIVE RATES
INCOME BRACKETS / RATE
%
%
%
%
%
%
1.3 Are there any deductions or tax exemptions? Please describe them.
Deductions:Expenses relating to rental income (20% forindividuals only), donations, losses brought forward, expenditure incurred for the maintenance of a building declared as a conservation building (limits apply).
Capital allowances:
Available to both individuals and companies on the cost of acquisition of buildings (3% on commercial, 4% on industrial, agricultural and hotel buildings, and 10% on metal and 33⅓% on wooden frames of greenhouses.
Personal allowances:
Life insurance premiums (subject to conditions).
1.4 Are there any other taxes added to the income tax? Please name and describe them.
Special contribution for defence:3% on rental income after expenses (reduced by 25%).
3% on profits of public corporate bodies.
2. Owner occupied housing tax
(Tax on the indirect profit of someone who lives in his own house and doesn't pay rent)
2.1Does an owner occupied housing tax exist in your country?
YES / NO2.2 If it exists, please name the rate and the base of calculation.
RATE / BASE OF CALCULATION%
2.2Are there any deductions or tax exemptions? Please describe them.
3. Property Tax
3.1 Do taxes on the ownership of real estate exist in your country? Please name and describe them.
NAME OF TAX / APPLIED ON WICH TYPE OF REAL ESTATE / TAX RATE / BRACKETSImmovable property tax / All types of real estate / 0,00 ‰
2,50 ‰
3,50 ‰
4,00 ‰ / €0 – €170.860,14
€170.860,15 – €427.150,136
€427.150,37 – €854.300,72
in excess of €854.300,72
Municipal property tax / All types of real estate / 1,50‰ / Flat rate
Sewerage charges / Buildings in areas served by the network. Paid until the capital expenditure for the network is recovered. / 5,00 ‰ / Flat rate
BASE OF CALCULATION / ONLY FOR REAL ESTATE? / TYPE OF TAX
NATIONAL /
FEDERAL / RIGIONAL / MUNICIPAL /
LOCAL
Market value of 01.01.1980 / YES / NO
YES / NO
YES / NO
3.2Are there any deductions or tax exemptions? Please describe them.
Immovable property tax:Agricultural land used as such by its owner, public cemeteries, churches and other religious buildings, public hospitals, schools, building owned by the Government, embassies and consulates, common use areas, properties under Turkish occupation, preserved buildings and buildings used by charities.
4. Gifts & Inheritance Tax
4.1 Are there taxes on gifts and / or on inheritance?
ON GIFTS / ON INHERITANCE / NONE4.2Please describe the main characteristics of the taxes.
FAMILY TIES / GIFTS / INHERITANCEBRACKETS / RATE / BRACKETS / RATE
SPOUSES
PARENTS & CHILDREN
GRANDPARENTS
GRANDCHILDREN
SISTERS & BROTHERS
UNCLES / AUNTS
NEPHEWS / NIECES
OTHERS
5. Real estate transfer tax
5.1 Is there a tax on the transfer of real estate in your country?
YES / NO5.2 Is the tax rate for transferring real estate proportional (single rate) or progressive (tax scale)? Please fill in the base of calculation, the rates and the scales.
PROPORTIONAL RATERATE / BASE OF CALCULATION
%
PROGRESSIVE RATES
BRACKETS / RATE
€0 - €85.430,07 / 3%
€85.430,08 - €170.860,14 / 5%
In excess of€170.860,14 / 8%
%
%
5.3 Are there any special deductions or exemptions from this tax? Please describe them.
Transfer by way of gift to family company:The transfer fees are refundable after five years if the shareholders are members of the donor’s family, the property remains into the company and there is no change in the shareholders.
Transfer by way of gift between relatives up to the 3rd degree of kindred:
The percentages are based on the value of the property in 1933.
6. Capital gains tax
6.1 Is the profit between the purchase cost and the sale price of real estate taxed as income or differently?
AS INCOME / DIFFERENTLY / NO TAXATION6.2 If the capital gains tax differs from the income tax, please fill in the rate.
RATE: / 20 %6.3 Are there any special deductions or exemptions from this tax? Please describe them.
Lifetime exemptions:The first €17.086,01 of taxable gains arising from the disposal of any property.
The first €25.629,02 of taxable gains arising from the disposal of agricultural land by a farmer (subject to certain conditions).
The first €85.430,07 of taxable gains arising from the disposal of private residence used by the owner as main residence (subject to certain conditions).
An individual is entitled only to one of the above three exemptions, whichever is the greater.
Exempt disposals:
Transfers by reason of death, gifts between relatives up to third degree, exchange of properties (under certain conditions), gifts to companies of which shareholders are of donor’s family and continue for five years, gifts to the Government, district authorities and approved charitable institutions, gifts from family companies to their shareholders if property was acquired by way of donation and kept for three years, expropriations and transfers as a result of reorganisations (under certain conditions).
7. Value added tax (VAT)
Are there VATs on exchanges related to real estate? (construction, renovation, transactions, rental income, etc.). Please name and describe them.
KIND OF EXCHANGE / RATE / COMMENTSConstruction / 15 %
Renovation & Reparation / 15 %
Delivery of new buildings / 15 %
Building sites / 0 %
%
%
%
8. Other taxes
Are there any other taxes on real estate not mentioned above? Please name and describe them.
9. Calculation of property value
9.1 Who is competent to estimate the value of property as the base of capital taxation?
NATIONAL / FEDERAL AUTHORITIES / THE TAXPAYER HIMSELFLOCAL AUTHORITIES / OTHER: ………………………………
9.2 How many different systems to estimate the value of property are applicable and what are their main characteristics?
Comparative sales method.9.2 How big are the differences between the estimated values and the real market values according to each one of these systems?
Differences are not very big.1