What do you actually pay on rent in Cyprus?
Three separate charges land on the same rent — income tax, the Special Defence Contribution and GESY — and they are worked out on different amounts. This puts all three in one number.
On this rent you would pay
24.7% of gross rent
Rent you keep: €13,553
How that is reached
The part that catches people out
SDC and GESY are charged on gross rent, not on profit. A property that makes no taxable income after interest and allowances still owes both — which is why an owner can pay tax on a property they consider loss-making.
The Special Defence Contribution stopped applying to rental income from 1 January 2026. If you are filing for 2025, switch the year above — it applied then, and only to those domiciled in Cyprus.
An estimate, not advice. Rates change and circumstances differ — confirm with your accountant before filing. · Rates checked 2026-08-24.
Rent is not taxed on its own
Rental income is added to everything else you earn and taxed as one total. A salary of €30,000 and €9,000 of rent are not two separate calculations: the rent sits on top, and it is taxed at the rate your combined income reaches.
This is why two owners with identical flats pay different amounts. It is also why a €12,000 rent can cost one person nothing and another person €3,000 — the difference is what else they earn.
What you can take off the rent
Every building gets a statutory deduction of 20% of its gross rent. It stands in place of repairs, so you do not itemise them, and you get it whether or not you spent anything that year.
On top of that: interest on a loan taken to buy or build the property, and capital allowances, typically 3% of the building cost each year. Both are subtracted before income tax is worked out.
Note what is not on that list. Insurance, municipal fees, common charges and management are not separately deductible against rent — the 20% is what covers them. They still come out of your pocket, which is why the number that matters is what a property nets, not what it rents for.
The three charges, and what they are worked out on
Income tax is charged on rent after the 20% deduction, interest and capital allowances, at the band your total income reaches. For 2026 the first €22,000 of total income is free of tax, then 20% to €32,000, 25% to €42,000, 30% to €72,000 and 35% above that.
GESY is 2.65%, charged on income from all sources up to a ceiling of €180,000. It applies to rent whether or not you are domiciled in Cyprus.
The Special Defence Contribution was the third. On rents it was 3% of 75% of the gross — an effective 2.25% — and only for people domiciled in Cyprus. It was abolished on rental income from 1 January 2026, so it matters for a 2025 return and not for 2026 onwards.
Questions
Do I pay tax on rent if I earn nothing else?
Possibly not. Rent is added to your other income, and for 2026 the first €22,000 of the total is taxed at zero. With no other income, €22,000 of rent after the 20% deduction still leaves you below the threshold — though GESY at 2.65% is charged from the first euro.
Is the Special Defence Contribution still charged on rent?
Not from 1 January 2026. It was 3% on 75% of gross rent, an effective 2.25%, and it applied only to people domiciled in Cyprus. It still applies to the 2025 tax year, so a return being filed now may well include it. One commercial tax site still describes it as current; we follow PwC and Sovereign, and your accountant has the final word.
Does being non-domiciled still help?
For rental income, that advantage has gone with SDC itself. Non-domiciled owners never paid SDC on rents; from 2026 nobody does. Income tax and GESY apply the same way either way.
Can I deduct the repairs I actually paid for?
Not separately. The 20% statutory deduction exists in place of repairs, so it applies whether you spent nothing or replaced a boiler. What you can add to it is loan interest and capital allowances of about 3% of the building cost.
My flat was empty half the year. Does that change the tax?
You are taxed on the rent you received, so an empty half-year means less rent and less tax. What it does not change is the insurance, the common charges and the municipal fees, which carry on. That gap between a property that earns nothing and one that costs nothing is the thing most owners never see written down.
Does it matter how the tenant pays me?
Since 1 July 2026, yes. Rent for property in Cyprus must be paid by bank transfer, card or another electronic method, and cash is no longer an accepted way to pay it. Keeping a record of how each payment arrived is now part of keeping your rental records.
Told when the rules change
The guides are free and stay free. Leave an address and I will write when something changes for landlords here — the rules, the deadlines, what accountants start asking for in February.
This is one year. What about the other four properties?
Stegi keeps the rent, the costs and the receipts per property all year, so this number is waiting for you instead of being reconstructed every spring.
See how it worksStegi