In Cyprus, there is a tax obligation known as the Stamp Duty. This tax is levied on the documentation related to assets or property on the island. When a buyer acquires real estate, they are required to pay the Stamp Duty before the sale and purchase contract is officially registered with the Cyprus Land Department.
Where to pay the Stamp Duty in Cyprus
This fee must be paid once at the Cyprus Tax Department within 30 days after signing the sale and purchase agreement.
Consequences of not paying Stamp Duty
If the Stamp Duty is not paid within the specified period, the buyer must pay a fine to the Cyprus treasury. If more than 30 days have passed since the signing of a contract exceeding €35. And the Stamp Duty has not been paid or is paid late (up to 6 months after signing), a penalty of 10 cents per euro is imposed. Additional penalties are imposed if the duty is not paid even after the first 6 months from the date of signing the contract.
Cost of the Stamp Duty
The amount of the Stamp Duty depends directly on the property’s value. For a property valued at less than €170,000, the duty is 0.15% of the price. For real estate priced above €170,000, the fee is 0.15% for the first €170,000 and 0.20% for the remaining amount. The first €5,000 of the value is exempt from tax.
Example calculation
For a property valued at €130,000, the calculation would be: (€5,000 x 0% + €125,000 x 0.15%) = €187.5.
For a property priced at €400,000, the calculation would be: (€5,000 x 0%) + (€165,000 x 0.15%) + (€230,000 x 0.20%) = €707.5.
