Under the non-dom rules, Cyprus tax resident individuals who are not domiciled in Cyprus are completely exempt from Special Contribution for Defence (SDC) on dividends, interest and rental income. The total tax exemption makes the holding of investments in dividends and/or interest earning financial assets, including shares and bonds, in Cyprus and anywhere in the world extremely attractive for non-Cyprus domiciled individuals. The maximum income tax rate on personal income in Cyprus is 35% for income in excess of €60,000. With the recent incentive, 50% of remuneration from any employment exercised in Cyprus by a non-Cyprus resident is exempted for a period of ten years provided the annual income exceeds €100,000. Other tax breaks are available for those earning between €60,000 and €100,000.

For more information, contact a Cyprus-based accounting firm.