Review of Declarations for Reduced VAT (5%) on Residential Property in Cyprus until 31 December 2026
As part of the latest Cyprus Real Estate news, the Tax Department announces that, based on the Amending Law Ν.109(Ι)/2026 published in the Official Gazette of the Republic (Issue 5089, 24 April 2026), the Tax Commissioner is authorised to examine applications (Declarations) submitted under Article 63 until 31 December 2026, where their review was delayed due to delays from planning authorities.
This is particularly relevant for buyers and investors in Cyprus Properties and the wider Cyprus Real Estate market.
It is clarified that Article 63 constitutes a transitional provision covering cases where:
- A planning permit has been obtained, or
- An application for a planning permit has been submitted
by 31 October 2023.
Key Points for Cyprus Property Buyers
Based on the above:
- The Tax Commissioner will accept Declarations for the application of the reduced VAT rate (5%) for properties where:
- A planning permit application was submitted or approved by 31 October 2023, and
- A building permit was issued after 1 January 2025, or will not be issued by 31 December 2026.
- For the reduced VAT rate to apply to the first 200 square metres of buildable area:
- The planning permit application must have been submitted by 31 October 2023, and
- The building permit must have been issued by 31 December 2024, and
- The Declaration must be submitted to the Tax Commissioner by 15 June 2026.
Important Submission Requirement
It is reminded that the “Declaration for the Application of the Reduced VAT Rate for the Purchase or Construction of a Residence” must be:
- Properly completed, and
Submitted exclusively through the Tax For All (TFA) system.