ARTICLE · 29 JANUARY 2026

Cyprus Tax Reform 2026 – Comprehensive Overview

CYAUSE Audit Services Ltd

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SUMMARY OF THE MAIN TAX CHANGES...

CyprusTax

Kyriakos Tramountanellis

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1. Corporation Tax

Rate increase: From 12.5% to 15% for profits starting 2026.
Aligns Cyprus with OECD minimum 15% global tax standards, although there was no need for it (read more here).

2. Dividend Tax

Rate reduced: From 17% to 5% for Cyprus-domiciled individuals.
Deemed dividend tax abolished.

3. Personal Income Tax

New tax-free threshold: €22,000 (up from €19,500).
Progressive tax bands:

Taxable Income	Rate
€0 – €22,000	0%
€22,001 – €32,000	20%
€32,001 – €42,000	25%
€42,001 – €72,000	30%
Above €72,000	35%

Families benefit from child allowances:
- 1st child €1,000, 2nd €1,250, 3rd+ €1,500 per parent.

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