SOCIAL INSURANCE – CYPRUS
Secure Your Future — Comply with Confidence.
Cyprus operates a comprehensive Social Insurance Scheme (SIS) covering employees, self-employed persons, and employers. Contributions fund pensions, maternity, unemployment, sickness, and other social benefits under the Social Insurance Law of 2010 (Law 59(I)/2010).
At a Glance
| Category | Contribution (%) | Paid By | Ceiling (2025) |
|---|---|---|---|
| Employees (Private Sector) | 8.8% | Employer & Employee each | €62,868 annual earnings |
| Self-Employed | 16.6% | Paid entirely by insured person | Based on fixed income range |
| Government Contribution | 4.3% | State | — |
| Total (Employer + Employee + State) | 21.9% | — | — |
The Cyprus social insurance system ensures long-term protection, benefits, and retirement security for every contributor.
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We ensure full alignment with Cyprus social security, GESY, and labour law obligations.
1. Overview
The Cyprus Social Insurance Scheme (SIS) provides financial security for workers and their families in cases of sickness, unemployment, maternity, invalidity, old age, or death. It is mandatory for all employees and self-employed individuals working in Cyprus, irrespective of nationality or employer origin. The scheme is supervised by the Social Insurance Services of the Ministry of Labour and Social Insurance.
2. Current Contribution Rates (Effective 2024–2025)
| Contributor | Contribution (%) | Basis |
|---|---|---|
| Employer | 8.8% | Employee’s gross earnings |
| Employee | 8.8% | Employee’s gross earnings |
| Government | 4.3% | Employee’s gross earnings |
| Total | 21.9% | — |
- The contribution rate increases gradually every five years until reaching 10.7% by 2039 (for both employer and employee).
- Contributions are capped at the maximum insurable earnings determined annually.
- For 2025, the ceiling is €1,209 per week (€62,868 per year).
3. Self-Employed Persons
| Category | Contribution (%) | Notes |
|---|---|---|
| Self-Employed Individuals | 16.6% | Based on notional income, varying by occupation |
| Government Contribution | 4.3% | Added to insured’s account |
| Payment Frequency | Quarterly | Via Social Insurance e-Service or JCCSmart |
Each occupational category (e.g., professionals, tradesmen, farmers, drivers) has its own minimum and maximum insurable income, reviewed annually.
4. Additional Contributions
| Scheme | Employer (%) | Employee (%) | Purpose |
|---|---|---|---|
| Redundancy Fund | 1.2 | — | Redundancy compensation |
| Industrial Training Fund | 0.5 | — | HRD training and skills development |
| Social Cohesion Fund | 2.0 | — | General state welfare funding |
| Holiday Fund (where applicable) | 8.0 | — | Paid leave coverage for certain sectors |
These contributions are payable only by the employer in addition to the main social insurance contributions.
5. Payment and Reporting
Method:
- Electronic payment via Social Insurance Services Portal or JCCSmart.
- Employers must file monthly electronic statements showing gross pay, employee details, and contributions.
Deadlines:
- Employees: Employer contributions due by end of following month.
- Self-Employed: Quarterly, within one month after the quarter’s end.
Documentation:
- Employers must maintain payroll records for at least six years.
- All employees must have a Social Insurance Number (SI No.) before employment starts.
6. Benefits Provided Under the Scheme
- Old-Age Pension (based on years of contributions)
- Widow’s and Orphan’s Benefits
- Invalidity and Injury Benefits
- Unemployment Benefit
- Sickness and Maternity Benefits
- Funeral Grant
- Severance and Redundancy Payments
Eligibility depends on contribution history and minimum insurance points accumulated.
7. Interaction with GESY (National Health System)
In addition to the Social Insurance Scheme, employees and employers also contribute to the General Healthcare System (GESY):
| Contributor | Rate (%) | Basis |
|---|---|---|
| Employer | 2.90 | Gross earnings |
| Employee | 2.65 | Gross earnings |
| Self-Employed | 4.00 | Gross income |
| Government | 4.70 | Gross income |
GESY contributions are separate from social insurance but are collected together in most payroll systems.
8. EU and International Coordination
- Cyprus applies EU Regulation (EC) 883/2004, allowing transfer of insurance periods between member states.
- Non-EU nationals may benefit from bilateral social security agreements (e.g., with the UK, Canada, and others).
This ensures contributions made abroad can count toward Cyprus benefits and pensions.
9. Penalties for Non-Compliance
| Offence | Penalty |
|---|---|
| Late payment of contributions | 3% surcharge per month of delay (max 27%) |
| Failure to register employees | Administrative fine + retroactive contributions |
| Non-filing of returns | Legal penalty under Social Insurance Law |
Employers are jointly and severally liable for unpaid contributions, which are deductible for income tax purposes once paid.
10. Why Clients Choose Our Firm
- Payroll setup and monthly social insurance filing
- Full GESY and SIS compliance management
- Registration of employers and employees with authorities
- Employee benefits and pension advisory
- Handling of inspections and audits by Social Insurance Services
We ensure your company’s payroll and benefits remain fully compliant — protecting both your business and your employees.