Cyprus “60 Day Rule” Tax Residency – New Round – Tax Authorities

13 June 2022

Oxford Management

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On 01 February 2022 the Ministry of Finance issued a new

circular regarding the 60 day tax resident rule. The circular was

issued to ease rules in regards to obtaining residency under the 60

day rule and speed up the process of issue of certificate.

Criteria:

According to the Cyprus tax law, an individual is considered a

Cyprus tax resident under the 60 day tax rule if the below

conditions are met:

An individual does not spend more than 183 days, either

continuously or in total, of that tax year in another country;
The individual is not a tax resident in another country for

that year;
An individual spends at least 60 days in Cyprus, either

continuously or in total, during that year;
The individual carries out a business and/or is working in

Cyprus, and/or holds an office with a Cyprus tax resident company

any time during that year;
The individual either owns or rents a permanent residence in

Cyprus;

Exemptions:

The circular listed a few exemptions and clarifications. One

exemption to the 60 day rule conditions listed above, is in the

case that the applicant is from the United Kingdom. If the

individual claiming the tax residency based on the 60 day tax rule

for a specific tax year and during the same period the individual

was also a tax resident in the United Kingdom, then condition (B)

listed above is not applicable.

The above exemption also applies in the cases where an

individual is a tax resident in a country that follows a different

calendar tax year than Cyprus. For example, in one state a tax

calendar year might commence in April 2022 and conclude in April

2023. In this event, the individual applying for a Cyprus tax

residency under the 60 day rule might also be permitted to

oversight condition (B) listed above, assuming they also receive

approval from the Registrar.

60 Day rule certificate – Fast track

For the issuance of a Cyprus tax resident certificate for

individuals that meet the conditions listed above, a special

statement Form Τ.Φ.126 (2022) must be completed and

submitted along with all the other supporting documents to the

Cyprus tax department. All supporting documents must be submitted

in either the English or the Greek language and appropriately

stamped under the Cyprus stamp duty law. If the supporting

documents are in a language other than English or Greek then an

official translation must be done to either one of the two

mentioned languages.

The process for obtaining the 60 day tax resident certificate

has been simplified and can now be issued upfront and in advance

before the 60 days pass. In order for the certificate to be issued

under the fast track process, the below listed evidence must be

provided:

Evidence of an employment appointment/holding an office;
Justifications on the need of the fast track procedure;
A receipt of an upcoming income from a source that is outside

of the Republic of Cyprus and therefore justifies the urgent need

to present the Cyprus tax resident certificate to the tax

administrators abroad

Other considerations:

Individuals that qualify for the 60 day rule tax resident scheme

and are also domicile in Cyprus are required to pay Special Defence

Contribution on the below listed rates:

Dividend income: 17%
Interest income: 30%
Rental income: 3%

For more details in regards to the 60 day rule tax residency

scheme and the new circular please contact our offices at [email protected].

The content of this article is intended to provide a general

guide to the subject matter. Specialist advice should be sought

about your specific circumstances.