As of January 1, 2017, the following conditions need to apply if an individual is to be considered a Cyprus tax resident: (a) the individual must not have remained in any other country for more than 183 days within the relevant tax year; (b) he is not considered or declared a tax resident in another Country; (c) he must remain in Cyprus for at least 60 days in the relevant tax year; (d) he must carry a business or must hold an employment in Cyprus or must hold an office in a Cyprus tax resident person within the relevant tax year; and (e) he maintains a permanent home in Cyprus either through ownership or rental. Also, there is no special defense contribution; a non dom is exempt from Special Defense Contribution (SDC) in relation to dividends, interest and rents. A non-dom earning dividend income, from foreign as well as local investments will not be subject to SDC as of July 16, 2015. In addition, dividend income is unconditionally exempt from income tax. Therefore, the tax payable by a Cyprus resident non-dom on dividend income will be zero. A non-dom earning interest income, from foreign as well as local sources, will not be subject to SDC as of July 16, 2015. In addition, interest income is also exempt from income tax. Therefore the tax payable by a Cyprus resident non-dom on interest income will be zero. A non-dom earning rental income, from properties in Cyprus or abroad, will also not be subject to SDC as of July 16, 2015. Rental income will only be subject to income tax at the normal rates (following a 20% allowance). If you are a retiree and you do not apply on the above, then you will be taxable on income basis which you will not have. For the digital nomad, tax is based on your income. As a digital nomad, Cyprus makes it straightforward to navigate its immigration system and establish permanent residency. Further, Cyprus only requires an individual to stay in Cyprus at least 60 days annually to become a tax resident. For online entrepreneurs and those who travel for business, this provides 10 months of travel time while still making the most of tax benefits. The “60 Day Rule” provides security and a favorable base for those whose business it is to travel and work away from home.
