Cyprus Non-Dom Status 2026: 0% Tax on Dividends and Interest for 17 Years
Become a Cyprus tax resident without being domiciled there, and dividends and interest are exempt from Special Defence Contribution for 17 years — with a new option to buy 10 more years for €500,000.
The short answer
Non-domiciled Cyprus tax residents
How to qualify: residency first, then non-dom
Step 1 — Become a Cyprus tax resident
You can qualify either the standard way or the fast way:
183-day rule: spend more than half the tax year physically present in Cyprus — no other conditions attached.
60-day rule (2026): spend at least 60 days in Cyprus, do not spend more than 183 days in any single other country, run a business, work, or hold a directorship tied to Cyprus, and maintain a home there (owned or rented) at some point in the year.
As of 2026, the 60-day rule no longer requires you to avoid tax residency elsewhere — you can meet Cyprus's conditions while another country also claims you as resident under its own law.
Step 2 — Confirm you are non-domiciled
Domicile is different from residency and mostly outside your control:
You are non-dom by default if your domicile of origin (broadly, your father's domicile at your birth) is outside Cyprus and you have not acquired a domicile of choice there.
You are automatically treated as domiciled — and lose the exemption — once you have been a Cyprus tax resident for at least 17 of the preceding 20 tax years.
Cypriot-born individuals with a Cyprus domicile of origin generally cannot claim non-dom status, even if they lived abroad for decades.
Non-dom vs. standard Cyprus tax residency
| Item | Non-dom resident | Domiciled resident |
|---|---|---|
| SDC on dividends | 0% | 17% |
| SDC on interest | 0% | 17% (30% on some deposit interest) |
| GESY on dividends/interest | 2.65% (capped at €4,770/yr) | 2.65% (capped at €4,770/yr) |
| Personal income tax (salary) | Standard progressive bands, up to 35% | Same — non-dom does not touch salary tax |
| Duration of exemption | 17 years, extendable | Not applicable |
Non-dom status changes only the SDC treatment of passive income (dividends, interest, some rents). Employment income is taxed the same way for everyone under Cyprus's normal personal income tax bands.
The 2026 change: buying 10 more years
The €250,000 extension
The 2026 tax reform lets individuals whose domicile of origin is outside Cyprus extend the SDC exemption after their standard 17 years run out:
Pay a lump sum of €250,000 to buy a further 5-year SDC exemption period.
This can be repeated once more — a second €250,000 payment for a second 5-year block.
Maximum total: 17 years standard + 10 years purchased = 27 years of 0% SDC, at a total extension cost of €500,000.
Individuals who became deemed domiciled in 2024–2026 had a transitional window (to 30 June 2026, per Circular 2/2026) to apply for the 2026–2030 period.
GESY does not disappear
See what net income you actually keep in Cyprus
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FAQ
Do I automatically get non-dom status when I move to Cyprus?
No. You first need to become a Cyprus tax resident (183-day rule, or the 60-day rule if all four conditions are met), and separately you need to not be domiciled in Cyprus under the domicile-of-origin/domicile-of-choice test. Most foreign nationals relocating to Cyprus qualify as non-dom automatically once resident, but it is worth confirming with a local advisor, especially if you have Cypriot ancestry.
What exactly does non-dom status exempt me from?
It exempts dividends, bank and corporate bond interest, and most rental-related income from Special Defence Contribution (SDC) — normally 17% on dividends and up to 30% on some interest. It does not exempt you from GESY (2.65%, capped at €4,770/year) or from personal income tax on salary and other active income.
What happens after the 17 years run out?
Historically, you became 'deemed domiciled' and started paying full SDC. Since the 2026 reform, you can instead pay €250,000 to extend the exemption for another 5 years, and repeat once more for a second €250,000 payment — up to 10 extra years, 27 in total.
Does the 60-day rule still require me to avoid residency elsewhere?
No — that requirement was removed in 2026. You can now qualify under Cyprus's 60-day rule (60+ days in Cyprus, under 183 days in any other single country, Cyprus-linked business/employment/directorship, and a home in Cyprus) even if another country also treats you as tax resident under its own domestic rules. A double tax treaty then decides which country has primary taxing rights if there is a genuine conflict.
Keep reading
Cyprus Corporate Tax Rises to 15% in 2026
What the Pillar Two-driven rate change means for small companies, plus the SDC reform context.
The 183-Day Rule: How Tax Residency Actually Works
The mechanics of day counting and the tie-breaker rules when two countries both claim you.
Cyprus Personal Taxation
Income tax bands, deductions, and social contributions for Cyprus residents.
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