How to pay 0% taxes on capital gains in Cyprus
With the Non-Dom scheme in Cyprus you pay 0% taxes on dividends, interest and investments income!
July 19, 2023 • 2 min read
I hope you know by now about all the advantages of the Non-Dom status in Cyprus, which offers a lot of benefits to foreigners relocating to the island. If you don't, make sure to read the blog article featured at the end of this page.
The main advantage of the Non-Domicile Tax Residency (Non-Dom) for private traders and investors is the fact that registered individuals are legally not liable to the "Special Defence Contribution" (SDC) for the duration of 17 years, comprising of the following taxes (list not exhaustive):
- 30 % on interest income
- 17% on dividend income
Additionally, capital gains achieved through the sale of shares (excluding shares of companies not listed on a recognised Stock Exchange which own immovable property situated in Cyprus) are not taxable in Cyprus to begin with anyway. Dividends and interest income are thus not taxed at all, only subject to a small contribution to the National Health System (GESY) of 2,65%.
Conversely, capital gains tax is only charged on the sale of Cyprus immovable property (i.e. real estate).
A viable consequence of these circumstances is that it appears beneficial to people moving to Cyprus with the intention to incorporate and work through a company under the Non-Dom regime (as stated in the blog article at the bottom) to not transfer private investments and/or shares to the company, but instead to keep them under private control to optimize the overall tax burden.
Disclaimer: This article is published for educational and informational purposes only and does not represent legal, financial or investment advice. The reader is responsible for seeking professional counsel.
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