Low taxation Cyprus is very unique when it comes to the taxation aspects of living on the island. Cyprus has conducted treaties for the avoidance of double taxation with the following countries: Austria, Bulgaria, Canada, China, Czech Republic and Slovakia, Denmark, France, Germany, Greece, Hungary, Ireland, Italy, Kuwait. Norway. Poland. Romania, Russia, Sweden.
U.K., USA and Yugoslavia.

There are negotiations due for the ratification of treaties with Egypt, Malta, Syria, Belgium, Finland and the countries comprising the Commonwealth of Independent States.The main purpose of these treaties is the avoidance of double taxation of income earned in any of these countries.For example, United Kingdom citizens may take advantage of the Double Taxation Treaty existing between the U.K. and Cyprus.This enables you to receive your pensions in Cyprus FREE of U.K. withholding tax.

This Treaty is unique to Cyprus since it includes both public and private sector pensions. Recent tax reforms sharply reduce the tax burden in foreign residents, in recognition of their value to the economy.Individual non-Cypriots can choose to be taxed on a flat basis of 5 percent per annum on pension and investment income brought into Cyprus.

For persons working in Cyprus, personal allowances free of tax is currently £11,000 per year. Consequently, the total tax burden on foreign residents is in practice often only 3 percent. This compares dazzlingly with competing destinations where property owners are subject to high tax exposure.