Previously, the 183 day rule was enforced which has been replaced with new criteria of determining whether an individual is tax resident in Cyprus or not.
The new criteria for determination of Cypriot tax residency for individuals states that if an individual does not remain in any other state for a period exceeding 183 days in the year of assessment and is not tax resident in any other state for the same year of assessment, then that individual will be considered tax resident in Cyprus if all of the below conditions are met:
- The individual remains in Cyprus for at least 60 days in the year of assessment and,
- The individual carries out business in Cyprus or is employed in Cyprus or holds a position to a person tax resident in Cyprus at any time during the year of assessment and,
- The individual maintains a permanent residence in Cyprus either owned or rented.
If the individual ceases to carry out business in Cyprus or be employed in Cyprus or hold a position to a person tax resident in Cyprus then the individual will not continue to be tax resident in Cyprus for that year of assessment.
The new provisions have effect as of 1 January 2017.