Buying Property in Cyprus Through a Company or in Your Own Name: VAT, Rental Tax and Costs (2026)

Short answer: for one home or one rental, buy in your own name. A company pays 19% VAT where an owner-occupier pays 5%, has no personal capital gains exemptions, and its running cost is assumed at €2,500 to €4,000 a year in the calculations below. It starts to cost less only when the rent is high: for an owner taxed at 35% on extra income and €2,500 of running costs, the break-even is about €11,400 of rent a year if the profits stay in the company.

The rules below are those in force on 30 October 2026, after the tax reform that took effect on 1 January 2026. They are taken from Cyprus laws in the Cyprus Law Library, the Registrar of Companies, EY and PwC; the list is at the end of the article. The examples are illustrations for a Cyprus tax resident, not tax advice, and the running-cost figures are assumptions you should replace with quotes from a Cyprus accountant.

Buying Property in Cyprus Through a Company: What Changes, What Does Not

A company changes who owns the property; it does not make the purchase cheaper. The price, the land registry transfer fee and the legal work on the contract belong to the property, so they are the same whoever signs. What changes is which taxes the owner pays afterwards, and a few reliefs that exist only for individuals. The table lists the differences that matter in 2026.

Transfer fees and the other purchase costs are broken down in the cost of buying property in Cyprus, and the charges every owner pays each year are in the annual property tax guide. The company only changes the rows above.

VAT on a Company Purchase: 19% Where an Owner-Occupier Pays 5%

The reduced 5% rate is for an individual who buys a new home as a main and permanent residence. A property bought to rent out does not qualify, and a company cannot use the rate. The relief also has limits: it covers the first 130 m² and value up to €350,000, on condition that the whole deal does not exceed €475,000 and the total buildable area does not exceed 190 m² (VAT Law, Fifth Schedule, Table C; PwC). The remaining area bears the 19% rate. The effect on a typical new-build is large.

The 5% rate also comes with a condition: the home must serve as your main and permanent residence for ten years. If you stop living in it earlier, you must notify the tax office within 30 days and repay the difference between 19% and 5% for the remaining years of the ten (PwC). Do not assume the 19% a company pays is recoverable: letting a dwelling is exempt from VAT (PwC), so ask your accountant before reserving whether any input VAT can be set off. An individual who buys an investment property pays 19% as well, so the VAT penalty of a company applies only to a home you would otherwise live in. The rules are explained in Cyprus property VAT explained.

Rental Income: Personal Tax Bands Against 15% Corporate Tax

An individual pays income tax on rent after a 20% allowance for buildings, at the 2026 bands: 0% up to €22,000, 20% to €32,000, 25% to €42,000, 30% to €72,000 and 35% above. On top comes the 2.65% GeSY contribution, which stops once all your income reaches the €180,000 ceiling, a maximum of €4,770 a year; the calculations below apply it to gross rent. The Special Defence Contribution on rent was abolished from 1 January 2026 for individuals and companies alike. A company pays 15% corporate tax on rent after its expenses, and an owner who takes profit out as a dividend pays the 5% SDC if resident and domiciled (on profits of 2026 onwards), 0% as a non-dom, plus 2.65% GeSY. The dividend rules are covered in the tax residency guide.

To compare the two on a fair footing, take a rent of €30,000 a year. The real property costs (maintenance, insurance) are €6,000, which equals the 20% allowance, so neither side is favoured. The company's running cost for bookkeeping, audit or review and the tax return is assumed at €2,500 a year (an assumption, not a quote). There is no mortgage interest, and tax depreciation of the building is left out.

The arithmetic behind the table: with no other income, 80% of the rent is €24,000, of which €2,000 is above the €22,000 band and taxed at 20%, which is €400, plus €795 GeSY (2.65% of €30,000). With €80,000 of other income, the same €24,000 is taxed at 35%, which is €8,400, plus €795. In the company, the profit is €30,000 − €6,000 − €2,500 = €21,500, and 15% of that is €3,225. A dividend of the remaining €18,275 adds €484 GeSY and, for a resident domiciled owner, €914 SDC.

Read the result both ways. An owner with no other income pays €4,530 more through a company. An owner in the 35% band saves between €2,072 and €3,470 a year, depending on whether the profit is paid out.

Where a Company Starts to Cost Less Than Your Own Name

The company's running cost is a fixed block, while the personal tax grows with the rent and with your marginal rate. Solving the two against each other gives the annual rent at which the company becomes cheaper, here for profit kept in the company. Only a quote from your accountant gives the real running cost, so the table uses two assumptions, €2,500 and €4,000.

If you also pay out the whole profit to a resident domiciled owner, the 35% case rises to about €14,600 and the 30% case to about €20,800 (at €2,500 of costs), and at a 20% rate the break-even rent rises above €130,000 a year. A property worth €400,000 rented at €1,500 a month yields €18,000 a year, which is below every break-even in the €4,000 column. The company starts to make sense for several properties under one roof or for a high-rent villa; a single flat rarely reaches the break-even.

Capital Gains When You Sell: 20% Either Way, With Personal Exemptions

Capital gains tax is 20% on the gain from selling a Cyprus property, whoever owns it. The difference is that an individual has lifetime exemptions: €150,000 on a main residence lived in for five years or more, and €30,000 once on any other property; the two do not add up, and the larger one applies. A company has none. Take a purchase at €400,000 and a sale at €520,000, with a taxable gain of €120,000 after allowable costs.

Selling the shares of a property-owning company is not a way around the tax. Shares of a company that owns Cyprus property are taxed at 20% capital gains tax, computed on the gain that relates to the property. Where the company holds the property through other companies, tax arises when at least 20% of the market value of the shares comes from Cyprus property; until 2026 the threshold was 50% (Capital Gains Tax Law 52/1980; EY). The seller also pays a 0.4% levy on the transfer of property or of shares in a property-holding company (PwC). The full seller's picture is in selling property in Cyprus and the wider overview in taxes on real estate in Cyprus.

Running Costs, Audit and the Non-EU Buyer Question

The €350 annual levy on Cyprus companies was abolished from 1 January 2024 (the Companies (Amendment) Law N.25(I)/2024 deleted section 391), although unpaid levies for 2011 to 2023 remain due. Some pages of the Registrar of Companies still carry the old wording about the €350 fee due by 30 June; the Registrar's own announcement of 21 March 2024 confirms the abolition. A company still has to keep accounts, file tax returns and file annual accounts. A private limited company has its financial statements audited (Companies Law, Cap. 113, section 152A). A review can replace the audit if net turnover, including rental income, does not exceed €300,000 and total assets do not exceed €500,000 at the balance sheet date, for at least two consecutive financial years. If the property sits on the balance sheet at more than €500,000, that route is closed because total assets exceed the limit.

One 2026 change favours companies. The deemed dividend rules, which treated part of a company's undistributed profit as paid out and taxed it, were abolished for profits generated after 31 December 2025. Profit can now stay in the company without a notional dividend, so the kept-profit row above carries no further tax. At the same time, new constructive-dividend rules apply to shareholders who are resident and domiciled, with a 10% withholding rate (EY); before you buy, ask your accountant how they apply if the owner lives in a house the company owns.

Buyers from outside the EU face a separate rule under the Immovable Property Acquisition (Aliens) Law, Cap. 109: an individual needs a permit before the title is registered in their name. A company does not remove the requirement. A Cyprus company in which half or more of the directors, votes or shares belong to people from outside Cyprus, the EU and the EEA counts as a foreigner itself. Buying shares that put a company under foreign control needs a permit as well (sections 2 and 3). A lawyer must confirm the position before you choose a structure. Choosing a property lawyer in Cyprus explains what to expect from the due diligence.

Who Should Use a Company to Buy Property in Cyprus, and Who Should Not

Buy in your own name if the property is your home, because the 5% VAT, the €150,000 exemption and the absence of running costs all belong to individuals. The same applies to one rental flat and to anyone whose extra income is taxed at 20% or less: the examples above show the company costing more in every such case.

A company deserves a calculation if you pay 30% or 35% on extra income, hold or plan several rental properties under one roof, intend to reinvest the profit in more property, or need a vehicle for business premises. The calculation has to use your own rent and quotes for the running cost. Management of the rented property is a separate expense in either structure; see managing a Cyprus property from abroad.

Checks Before Buying Through a Company or in Your Own Name

1. Ask an accountant to run your own figures: your marginal rate, the expected rent, a quote for the running cost and whether profit will be paid out.
2. Settle the VAT position before you reserve. The 5% rate belongs to a person buying a main residence, and a company cannot claim it.
3. If you are not an EU or EEA citizen, ask a lawyer about the Cap. 109 permit: it also applies to a Cyprus company controlled by people from outside the EU and the EEA.
4. If you need a mortgage, ask the bank in writing whether it lends to a company and on what terms. The guide to mortgages for foreign buyers describes the standard process.
5. Do not assume the company route avoids capital gains tax: a sale of shares in a company that owns Cyprus property is taxed.

Company or Own Name: Questions Buyers Ask

Tell us your budget, whether the property is a home or a rental and your current tax position, and we will send matching projects together with the questions to put to your accountant. If you are still deciding whether to buy at all, start with rent or buy in Cyprus.

Sources

All pages were opened on 30 October 2026.

• Companies (Amendment) Law N.25(I)/2024 deletes section 391 of the Companies Law: the €350 annual fee is not charged from 1 January 2024, duties for 2011 to 2023 continue.
• Registrar of Companies: announcement on the abolition of the annual fee of 21 March 2024 confirms the abolition and the continuing fees for 2011 to 2023.
• Companies Law, Cap. 113, section 152A: audit of a private company and the review route up to €300,000 turnover and €500,000 assets.
• Immovable Property Acquisition (Aliens) Law, Cap. 109: definition of a foreigner, company controlled by foreigners, permit (sections 2 and 3).
• Capital Gains Tax Law 52/1980: 20% rate, exemptions of €30,000 and €150,000, shares of companies with Cyprus property, 20% threshold.
• Income Tax Law 118(I)/2002: 15% corporate tax and the personal bands up to €72,000 and above.
• VAT (Amendment) Law 42(I)/2023: 5% on the first 130 m² and value up to €350,000, deal up to €475,000, area up to 190 m².
• General Healthcare System Law 89(I)/2001: 2.65% contribution on income and the €180,000 ceiling.
• EY: Cyprus enacts major tax reform legislation: 15% rate, abolition of stamp duty and deemed distributions, SDC on rent, 20% share threshold.
• PwC Worldwide Tax Summaries: Cyprus, other taxes: VAT on dwellings and re-use of the 5% rate, letting of dwellings exempt from VAT, transfer fees, 0.4% levy.
• PwC: taxes on personal income: 5% SDC on dividends from 2026, domicile after 17 of 20 years.