Cyprus Tax Authorities cleared the 5% VAT on new Residence
Firstly, June 16th of 2023 a VAT Amendment Law publish by Cyprus Tax Authorities in the official gazette of the Republic of Cyprus. Also, which introduces changes to the conditions for the application of the reduced VAT rate of 5%. That for the acquisition or construction of a residence.
The amending Cypriot law states that the 5% VAT rate will apply only to the first 130 square meters of the buildable area. Also, up to a total cost of 350,000 euros, provide that the total amount of transaction does not exceed 475.000 euros. Further, the total area does not exceed 190 square meters. Residences exceeding these limits are subject to 19% VAT on the total cost.
Transitional provisions Cyprus Tax Authorities
As a part of transitional provisions, the amendment does not apply to residential buildings. For which planning permission has obtain from the competent authority. Or an application for planning permission has been submitted to the competent authority by 31 October 2023. Also, the application form of the reduced VAT rate is duly submit to the tax authorities. That within three years of the date of entry into force of this amending law.