On July 14th, 2017, the Parliament of Cyprus approved a bill that amends the Income Tax Law and allows an individual to be considered as tax resident in Cyprus, provided that he lives in Cyprus 60 days (2 months) during the year meets cumulatively the following conditions:

1. 1. The individual does not remain in any other state for one or more periods which altogether exceed 183 days in the same tax year, and
   2. The individual is not tax resident in any other state for the same tax year, be considered to be a tax resident of Cyprus, provided that the following conditions are cumulatively met:

(i) The individual should remain in Cyprus for at least 60 days during the tax year;

(ii) The individual should pursue any business in Cyprus and/or to work/be employed in Cyprus and/or to be a director in a company tax resident in Cyprus at any time during the tax year.

It is clarified that an individual who cumulatively fulfils the above conditions is not considered as tax resident of Cyprus in the tax year, if in that year the exercise of any business and/or employment in Cyprus and/ or the holding of a post to a taxable person of Cyprus have ceased.

(iii) The individual should maintain a permanent residence in Cyprus, which can be either owned or rented by him.

For the purposes of calculating the days of stay in Cyprus:

(a) The day of departure from Cyprus is considered as a day outside Cyprus.

(b) The day of arrival in Cyprus is considered as a day in Cyprus.

(c) Arrival in Cyprus and departure from Cyprus within the same day is counted as one day in Cyprus.

(d) Departure from Cyprus and return to Cyprus within the same day is counted as one day outside Cyprus. Thus, under the new provisions, an incentive is given to an individual who is not a tax resident in any other state for the same tax year to transfer his tax residence to Cyprus and to be taxed only on income from the activities the individual exercises in Cyprus.

It is noted that for employment purposes in Cyprus with earnings in excess of Euro 55,000, an individual is allowed for an exemption from tax of 50% of the salary for a period of 17 years, which significantly reduces his income tax liability. At the same time, an individual is granted exemption from income tax or defense tax on dividends and interest received either in Cyprus or abroad, provided that such individual is considered as Non-Dom in Cyprus.