Further to what was reported before on this, on 22 June 2023 the Cyprus Parliament approved further amendments to the Income Tax Law in relation to this incentive.
The first amendment concerns the period over which a person should not be a resident of Cyprus. The exemption from Income Tax will be granted if the individual was not a resident of Cyprus for 15 consecutive years prior to any employment in the Republic. Previously that period was 10 years.
The second amendment is related to employment in Cyprus. The exemption will be granted for a period of 17 years from the date of employment (or until the termination of the relevant provisions of the Income Tax Law), irrespective of whether the individual changed employer during that period. So far the exemption was only granted for the first employment of an individual in Cyprus.
It should be noted that the above amendments also apply to the transitional provisions that were initially introduced when the legislation was published in the Official Gazette of the Republic on 26 July 2022, as covered here. Persons that were eligible for the 50% exemption from Income Tax on their remuneration from employment based on the provisions that were applicable before the amendments mentioned above, will continue to claim the 50% exemption, provided that they meet all the conditions that were applicable before the entry into force of the relevant amendments.
The amendments are applicable retrospectively from 1 January 2022.
