Capital gains tax in Cyprus: what is actually taxed

Cyprus capital gains tax (CGT) is 20%, and it reaches one thing only: gains from Cyprus-situated immovable property. Sell shares, sell a foreign apartment, sell almost anything that is not Cyprus real estate, and CGT does not apply. That narrow scope is a large part of why Cyprus is used as a holding location — the gain on an eventual share exit is normally outside the tax net entirely.

What the 20% actually applies to

CGT is charged on the gain from disposing of:

• Immovable property located in Cyprus — land, buildings, a house or an apartment.
• Shares in a company that owns Cyprus immovable property, where those shares are not listed on a recognised stock exchange.
• Shares that indirectly derive value from Cyprus real estate. From 1 January 2026 the threshold for this indirect charge dropped: CGT now applies where at least 20% of the market value of the shares comes from Cyprus property, down from 50%. This closed a route where property was held under layers of companies.

“Disposal” covers sales, exchanges, gifts and the grant of certain rights. Property physically outside Cyprus is never within Cyprus CGT — even for a Cyprus tax resident.

What is outside CGT — the securities exemption

Gains on the disposal of securities — shares, bonds, units and similar titles — are exempt from both income tax and CGT, for companies and individuals alike. The only crack in that exemption is the real-estate link above. For a founder selling an operating business held through a clean Cyprus holding company, the share exit is generally tax-free in Cyprus. We set out the mechanics on the corporate tax page; the exemption works the same way for the owner personally.

How the taxable gain is computed

The gain is the disposal proceeds minus the property’s cost and allowable expenses. What you can deduct:

• The original purchase cost, indexed for inflation over the holding period.
• Improvement costs (not repairs).
• Costs directly tied to the acquisition and disposal — transfer fees, legal fees, estate-agent commission, and interest on a loan taken to acquire the property.

Because the base cost is indexed, the part of a nominal gain that is really just inflation is stripped out before the 20% applies.

Lifetime exemptions (raised by the 2026 reform)

Individuals get lifetime deductions — used once, then gone — which the 2026 reform increased substantially:

The main-residence figure rose from €85,430 and the general deduction from €17,086 — a real change for anyone selling a home they lived in. Conditions apply to the main-residence relief (ownership and occupation periods), and the deductions are per individual, so a couple owning jointly can each claim.

Filing and payment

CGT is self-assessed and settled around the transfer. In practice the calculation, the indexed base cost and the exemption claim are prepared as part of the conveyancing, and the tax is cleared before the Land Registry completes the transfer. Documenting the base cost and allowable expenses early is what keeps the bill correct rather than overstated. The wider set of one-off property costs sits on the property tax page.

How we handle it

1. Confirm scope. Whether the disposal is even within CGT — many share and foreign-asset exits are not.
2. Build the base cost. Purchase price indexed, improvements and acquisition costs gathered with evidence.
3. Apply the right exemption. Main residence, farmer or general, tracked against the lifetime cap.
4. File and clear. The computation submitted and the tax settled so the transfer completes without a snag.