Tax to be paid on rental

[alifeontheoceanwave]

I am going to rent my house in Cyprus after living here ten years, I have my title deeds. Can anyone tell me what taxes I have to pay on the rent I collect.. eg the CY government seems to be saying that I don't have to pay defence levy if I am not resident in CY

[Nigel Howarth]

Hello alifeontheoceanwave and welcome to the forum.

Firstly you'll be liable for Immovable Property Tax if you're not resident in Cyprus (and if you are resident in Cyprus).

You may also find that your local community/municipality will tax you on the rental income you receive - I suggest you check with them as not all communities and municipalities impose this tax.

And in the country where you are tax resident you will also be taxed on any rental income you receive.

Regards,

[alifeontheoceanwave]

Thanks Nigel,

I have another question if I may; I have an account at the Co-op branch in Peyia and the rent will be paid into that. I presume the interest accruing to that account is taxed/defence levied in Cyprus? or is that also declared and taxed in the country in which I am tax resident, ie UK?

Thanks in anticipation.

[Nigel Howarth]

Hi alifeontheoceanwave

The Special Contribution for Defence (SDC) is levied on income earned by Cypriot tax residents. Non-tax residents are exempt. So the Co-op shouldn't deduct SDC.

Also you should not pay any income tax on the rent you receive as this will be taxed in the UK. This income will be included under the double taxation agreement between the UK and Cyprus..

But you will need to inform the bank and the Tax Office when you leave.

Regards,