Most expats find banking, money, and taxes in Cyprus fairly manageable once they have the initial paperwork out of the way. New bank customers are closely vetted, so allow a little extra time to open an account. Tax rates are moderate by European standards, and the government has designed several generous tax breaks with new arrivals in mind.
Money in Cyprus
As elsewhere in the Eurozone, the official currency in Cyprus is the euro (EUR). One euro is made up of 100 cents.
The following denominations are in circulation:
- Notes: EUR 5, EUR 10, EUR 20, EUR 50, EUR 100, EUR 200, and EUR 500
- Coins: EUR 1 and EUR 2, plus 1 cent, 2 cents, 5 cents, 10 cents, 20 cents, and 50 cents
The EUR 500 note is no longer issued, but it is still legal tender.
The main currency in the north of the island, which is under Turkish Cypriot administration, is the Turkish Lira (TRY). Many businesses there also accept euros.
Banking in Cyprus
Residents tend to do their everyday banking in Cyprus with one of a handful of large lenders. Bank of Cyprus and Eurobank are the two biggest names, and Alpha Bank Cyprus is a clear third. Lots of expats also have an account with an app-based provider such as Revolut or Wise. These accounts are handy for international transfers and for everyday purchases while you sort out your local account.
Online and mobile banking are well developed in Cyprus, and customers can handle most day-to-day tasks in an app. That's handy for tenants, who have to pay rent by bank transfer or another electronic method. Landlords can't legally accept cash for rent.
Those who prefer to bank in person will generally find branches open from 8am to 2.30pm Monday to Thursday, and from 8am to 2pm on Fridays.
Opening a bank account in Cyprus
There's more paperwork involved in opening a bank account in Cyprus than you may expect. Banks in Cyprus conduct strict anti-money-laundering checks, so be prepared to prove your identity and income source.
Banks will usually ask for a passport, a Cyprus tax identification number (TIN), proof of address, and an employment contract or recent payslips. Many banks prefer a recent utility bill as proof of address and may not accept a lease agreement on its own, so new arrivals sometimes have to wait until they receive their first bill before they can apply. Some banks also ask for a reference letter from the applicant's previous bank or proof of residence registration.
Employers and relocation companies often have contacts at local branches and can help speed things up.
ATMs and credit cards in Cyprus
You can rely on credit cards in Cyprus in all but the most remote corners of the island.
By law, most retail and service businesses have had to accept card payments, and even schools, lawyers, accountants, and architects are subject to the rule. Cypriots now pay by card more often than almost anyone else in the eurozone. Visa and Mastercard are accepted almost everywhere, while American Express is less common. Contactless payment is standard at the till.
Cash is still useful in the mountain villages. The big Cypriot banks generally don't charge foreign cardholders to use their ATMs, but the independent machines in tourist hotspots are far pricier. If you're offered the chance to pay in your home currency at an ATM or card terminal, choose euros instead. The exchange rate for this dynamic currency conversion is almost always worse than your card provider's.
Useful links
Taxes in Cyprus
The first thing to settle for taxes in Cyprus is your residency. Expats who spend more than 183 days on the island in a calendar year count as tax residents and pay tax on their worldwide income. Non-residents pay tax in Cyprus only on income from sources in Cyprus.
Internationally mobile professionals can also qualify as tax residents under the 60-day rule if they spend at least 60 days in Cyprus during the year and no more than 183 days in any other single country. They also need a home in Cyprus that they own or rent and a job or business on the island.
Personal income tax is charged at progressive rates of 0 to 35 percent. A sizeable slice of each year's income is tax-free, and employees pay the top rate only on earnings above a fairly high threshold. Employers deduct your income tax at source through the pay-as-you-earn (PAYE) system. They also withhold employees' contributions to social insurance and the General Healthcare System (GESY).
Tax residents between the ages of 25 and 70 have to file an annual tax return, even if they have no taxable income. Taxpayers register for a TIN and file their returns online through the Tax Department's Tax For All (TFA) portal.
Employees who move to Cyprus for a well-paid job can claim a 50 percent exemption on their employment income for up to 17 years, as long as they weren't tax-resident in Cyprus for the 10 years before they started the job. Expats usually count as non-domiciled, and non-doms pay no Special Defence Contribution on dividends or interest for up to 17 years. There's no inheritance tax or wealth tax in Cyprus either.
The UK and the US are among the dozens of countries that have double-taxation agreements with Cyprus. Under these agreements, expats can generally claim relief so that they don't pay tax twice on the same income. US citizens still have to file US tax returns wherever they live, though.
Tax affairs can be complicated for anyone with income or assets in more than one country. Expats should ideally speak to a tax practitioner who specialises in expat cases before they move.