The «60-day tax residency rule» for individuals

A recent amendment in the Cyprus Income Tax Law introduced the new 60-days rule for individuals. Pursuant to the foregoing amendment, an individual shall be considered Cyprus tax resident, subject to the following five (5) conditions which must be fulfilled cumulatively in a tax year:

  • resides in Cyprus for a period or periods of at least 60 days in aggregate; and
  • does not reside in any other single state for a period or periods exceeding 183 days in aggregate; and
  • is not a tax resident in any other state; and
  • conducts business in Cyprus and/or is employed in Cyprus and/or holds an office (director) to a Cyprus tax resident legal entity, provided that such business and/or employment and/or office are not terminated and/or ceased before the 31st of December of the relevant tax year; and
  • maintains a permanent residence in Cyprus either owned or rented.

The issue of a tax residency certificate pursuant to the 60-days rule may be obtained prior to the expiration of the 60 days residency requirement, provided that:

  • the foregoing conditions of the 60-days rule are fulfilled; and
  • the application for the issue of the tax residency certificate relates to the collection of dividends or interests from sources outside Cyprus accompanied by documents evidencing the upcoming receipt of the income; and
  • the tax residency certificate indicates to which tax authority or organisation this will be submitted.

It should be noted that the current 183-days rule, applicable to individuals residing in Cyprus for more than 183 days in a tax year, without the requirement of fulfilling further conditions, still applies.

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