ARTICLE · 08 JANUARY 2024

Important Changes In VAT Law For Property Transfers

Symeon Pogosian LLC

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Effective as from the 1st of November 2023, a significant shift in Cyprus tax legislation, marked by the introduction of Law 42(I)/2023, has come into play.

CyprusTax

Angelina Alyabyeva

Effective as from the 1st of November 2023, a significant shift in Cyprus tax legislation, marked by the introduction of Law 42(I)/2023, has come into play. The new law brings about amendments to VAT regulations, primarily affecting property transfers.

Under this latest legislation, a 5% Value Added Tax (VAT) is now imposed on the initial 130 square meters (sq.m.) of a house or apartment with a value of up to €350,000. However, for properties ranging from 131 sq.m. to 190 sq.m. and valued up to €475,000, the VAT rate rises to 19%. This means that for the first 130 sq.m. and up to €350,000, VAT remains at 5%, but for any additional area up to 190 sq.m., VAT increases to 19%. For properties exceeding 190 sq.m. with a value over €475,000, the 19% VAT rate applies from the very first square meter and cent.

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