The standard VAT rate in Cyprus is 19%, with reduced rates of 9%, 5%, and 3%. You must register as soon as your taxable turnover exceeds €15,600 over 12 months.
If you provide B2B services to companies in other EU countries, you usually 0% via the reverse charge mechanism.
Below are all the rates, registration rules, and deadlines.
Cyprus has a standard VAT rate of 19%. Additionally, 9%, 5%, 3%, and 0% for specific categories.
| Rate | Category | Examples |
|---|---|---|
| 19% standard | most goods & services | advice, software, electronics, retail |
| 9% reduced | accommodation & hospitality | hotels, restaurants, passenger transport, hairdressers |
| 5% reduced | basic needs & social goods | food, medicine, books, new homes (first house) |
| 3% super-reduced | very limited | certain printed matter, cultural events, aids for the disabled |
| 0% zero rate | export & intra-EU B2B | exports outside the EU, B2B deliveries to EU companies, international transport |
Registration for VAT is mandatory from €15,600 in taxable turnover over 12 months, or as soon as you expect to reach that threshold within 30 days.
In addition, you must register as:
Voluntary registration often pays off: if you are below the threshold but want to reclaim input tax on start-up costs (office, equipment, incorporation), it makes sense.
It also instills confidence in EU customers who expect a VAT number on your invoice.
Our team of experts can almost certainly help you. Feel free to contact us and we will provide you with further information.
For services provided to a VAT-registered company in another EU country, the place of supply lies with the customer, so you do not charge Cypriot VAT. This is where most entrepreneurs go wrong, and is also the reason why VAT hardly plays a role for the typical Cyprus Ltd.
For example, does your Cyprus Ltd invoice a German GmbH or Dutch BV for consulting? Your invoice must be sent out with 0% VAT; the German company processes the VAT in Germany via the reverse charge mechanism.
The same applies in reverse: if you purchase services from a foreign supplier (a US developer, a Belgian accountant, Google Ads), you declare that VAT yourself via the reverse charge mechanism. The net amount is usually zero if your activities are fully taxable, but it can make you subject to registration requirements.
By way of comparison: the Cypriot standard rate of 19% is one of the lower ones in the EU. The Netherlands and Belgium are at 21%, Germany at 19%. And with the B2B reverse charge, VAT plays hardly any role in your core turnover for international service providers.
It is possible that you send a B2B invoice to a valid European VAT number, but that this number is nevertheless not valid for intra-community transactions and is not valid according to the VIES database.
You check this by using the VAT Validation tool here: https://ec.europa.eu/taxation_customs/vies/#/vat-validation, and it is best to do this before invoicing a new supplier.
| Obligation | Frequency | Deadline |
|---|---|---|
| VAT return | quarter | 10th of the 2nd month after the quarter (±40 days) |
| VIES declaration | monthly | 15th of the following month |
| Union OSS declaration | quarter | end of the month after the quarter |
| Record retention obligation | continuous | at least 6 years |
Late registration, submission, or payment results in fines (including €100 per late return) plus interest on the outstanding VAT. The Tax Department is intensifying enforcement, particularly regarding the reverse charge mechanism for purchased foreign services.
Registration takes place via the Tax For All (TFA) portal of the Cyprus Tax Department (it replaces TAXISnet).
You submit the registration form, provide your business documents, and receive your VAT number in the format CY + 9 digits.
Processing time is typically 1 to 3 weeks, usually coinciding with the incorporation of your Cyprus Ltd. If you are going to make intra-community supplies, you must register separately for VIES before your first supply.
New construction by a developer: 19%, or the reduced rate of 5% for a first permanent home up to 130 m² and a contract value of €350,000 (also for foreign buyers).
Existing properties (resales): no VAT. The details can be found on our page about buying real estate in Cyprus.
We guide the purchase as property consultants in Cyprus.
Some sectors are exempt (no VAT, but also no right to deduct input tax):
If you have both taxable and exempt activities, a pro rata deduction applies; have this calculated by an accountant.
For most international service providers with a Cyprus Ltd, VAT is a secondary matter alongside the 15% corporate income tax and the non-dom regime.
Would you like to know how it works out for your situation? We will include that in the first meeting.
Relevant information
Any questions? Feel free to ask us!
The standard rate is 19%. Reduced rates of 9%, 5%, and 3% apply to specific categories. Exports and intra-EU B2B deliveries are 0%.
No. If your taxable turnover remains below €15,600 and you do not trigger intra-community acquisitions or reverse charge on foreign services, registration is optional (but often beneficial).
With business customers in the EU, almost never. Under the B2B place of supply rules, you invoice 0% and the customer processes the VAT themselves via reverse charge.
Yes, if you are registered (possibly voluntarily). Input tax on legitimate business expenses is deductible.
CY followed by 9 characters (e.g. CY12345678X).
Via the Tax For All (TFA) portal of the Cyprus Tax Department, usually at the same time as your company formation.
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