Purchase of new properties in Cyprus - VAT rules

Since Cyprus’ accession to the EU, VAT is charged on all new property provided the initial application for a building permit was made after the 1/05/2004. All buildings that received the building permit prior to this date will have no VAT charge. Also all second-hand property including houses, apartments etc, have no VAT charge. Building plots/land are also exempt from VAT.
Special regulations which will treat the purchase/ building of a permanent residence to a lower VAT charge (5%) apply.
According to VAT Law, the reduced VAT rate of 5% is given to eligible persons for the construction or purchase of a new dwelling or flat, used as the main and primary place of residence under certain criteria. The said criteria can be summarised as follows:
- The dwelling is intended to be used or it is used by the entitled person as his main place of residence.
- An ‘eligible person’, according to the above mentioned Law was considered to be a person who is over 18 years old and he/she being a citizen of the Republic of Cyprus or a citizen of any other European member country, who is permanently residing in Cyprus.
For more information on Purchase of new properties in Cyprus - VAT rules.
Other Pages in Property-Related
- Application for permit to acquire immovable property in Cyprus by a foreigner (Non-EU)
- Changes to the Law regarding the acquisition of property in Cyprus
- Cyprus Property Transfer fees
- Acquiring Immovable Property in Cyprus by Non EU nationals
- Acquiring Immovable Property in Cyprus by EU Nationals
- Property transfer fees reduced for properties transferred until 31.12.2016