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Special Contribution

Special Contribution

As from 1st january, special contribution is abolished

Individual and pensioners working in Cyprus have the responsibility to pay taxes according to their monthly special.

Private Sector

  • Should pay this tax refers to private sector employees, self-employed persons and pensioners.
  • And above any month if their income exceeds 1,500 euros (excluding the first 13 month additional salary calculation), which is obliged to pay a minimum tax of € 10.
  • For employees and pensioners, the tax applies to Cyprus acquired salary, and the need to pay monthly.
  • For the employee, the more taxes assessed his employer (50%) , and this tax does not apply to retirement subsidies, revenue approved pension funds, qualified for reimbursement of fees and operating expenses vessels members.
  • For the self-employed, this tax applies to any business in Cyprus, and the need to pay provisional tax installments twice a year.
  • Private sector employees are not required to pay the following fees:
    1. Retirement bonus
    2. Compensation pension funds
    3. Hired by foreign governments or international organizations foreigner salarie
    4. Salaries of non-citizens of the Republic of foreign diplomats / consular representatives
    5. When the crew of a Cyprus ship salary
    6. To make up for the cost of the employer’s business and allowances

Public Sector

  • Should pay this tax refers to public sector employees and pensioners.
  • Minimum 10 euros of tax does not apply to individual public sector .
  • For within the scope of their high office as an employee, the special tax rates were 3%, 3.5% and 4% three levels.

Since January 1, 2014 to December 31, 2016, related to the tax bands and the applicable tax rate in the following table.

Tax Bands And The Applicable Tax Rate

From employment / pension of total salary (euros)

Government and semi-government employees and pensioners

Private-sector employees, self-employed persons and private sector pensioners (2) (3) (4)

2014-2016

First 1500

no

no

1501-2500

2.5% (1)

2.5% (minimum € 10)

2501-3500

3% (1)

3%

More than 3500

3.5% (1)

3.5%

Special taxes means granting tax charged to costs and reduces the individual’s annual taxable income.

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