The House of Representatives has voted changes to the Immovable Property Tax (IMP) on 14 July 2016. The changes were published in the Government Gazette on 25 July 2016 and apply for the tax year 2016.
The Immovable Property Tax (IMP) applies to both physical and legal persons (taxpayers) and is imposed on the total value of the immovable properties owned by the taxpayer on 1 January of each tax year.
The value of the immovable properties refers to the values established as at 1 January 1980 and only to the immovable properties situated in Cyprus. The rates applicable are as follows:
Total Value of Immovable Tax Rates
Up to Eur 40.000 0,6%
Eur 40.001 – Eur 120.000 0,8%
Eur 120.001 – Eur 170.000 0,9%
Eur 170.001 – Eur 300.000 1,1%
Eur 300.001 – Eur 500.000 1,3%
Eur 500.001 – Eur 800.000 1,5%
Eur 800.001 – Eur 3.000.000 1,7%
Over Eur 3.000.001 1,9%
* The first Eur 12.500 exempt from immovable property tax.
Changes to the Immovable Property Tax (IMP):
- The taxpayers will be required to pay tax only on the 25% of the tax liability as calculated based on the above rates provided they will settle their tax liability by 31 October 2016 (75% total discount).
- Taxpayers who will settle their tax liabilities between 1 November 2016 – 31 December 2016 will be required to pay the 27,5% of the tax liability.
- Taxpayers who will pay their tax liabilities after 31 December 2016 will be imposed penalty at the rate of 10%, i.e. 30,25% plus interest 4% per annum.
- Tax liabilities not exceeding Eur 10 will not be payable.
- The IMP is terminated since 1 January 2017.
- Taxes imposed by the Municipalities (Municipal Property Tax) will be cancelled since 1 January 2017.
We are at your disposal should you need any additional clarifications and/or explanations.