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Remote working for a UK company and living in Cyprus

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MikeGreo

Hi,

I've been weighing my options lately. There are a few concerns tax wise.

If I am working for a UK company remotely from Cyprus and given that I spend 90 days outside of Cyprus in the tax year, would I need to pay any taxes(income tax or anything else) to the Cypriot Government?

Best wishes,

Mike

Toon

You are likely to be regarded  as working here (even when working remotely by internet) and tax resident too so will need to declare your income and taxes here .

Best advice I can give you is see  a tax specialist here... Elizabeth Welsh in Paphos is highly recommended

Toon

Maybe even consider opting for the dual taxation treaty between U.K. and Cyprus

MikeGreo

Hi Toon, thanks for your reply.

From what I've read there is a 90 day rule.

"If you are employed abroad for over 90 days a year, your entire salary may be free of Cyprus taxes. This applies if your employer is not tax resident and does not have a permanent establishment in Cyprus (although your earned income may still be taxable in the country of origin)"



Also mentioned

A 90-day rule exemption also exists, whereby remuneration from salaried services rendered outside Cyprus for more than 90 days in a tax year to a non-Cyprus resident employer or a foreign permanent establishment of a Cyprus resident employer are exempt from taxation.
The 90 days need not be consecutive provided that:
-they fall within the same tax year;
-the individual remains a Cyprus tax resident (ie, they must spend between 90 and 183 days abroad); and
-an employer-employee relationship must exist (ie, sole traders and freelancers cannot benefit from this exemption).
-Further, any gratuity income on retirement is exempt from taxation. If a foreign national receives foreign pension income, they can elect to have it taxed:
"the individual remains a Cyprus tax resident (ie, they must spend between 90 and 183 days abroad); and"


I have never heard anything like this before for any other country. So basically if you leave the country for 3 months and you work abroad during  that time, all income generated in that full one year (i.e. 9 months living and working in Cyprus and 3 months living and working in another country), all that income for that year is tax free?

Toon

thats interesting - and i would go with that  as Blevins Franks is one of the very best for advice - I used them for advise when i moved here 7 years ago.. best advise Ive ever had.

Toon

MikeGreo wrote:

Hi Toon, thanks for your reply.

From what I've read there is a 90 day rule.

"If you are employed abroad for over 90 days a year, your entire salary may be free of Cyprus taxes. This applies if your employer is not tax resident and does not have a permanent establishment in Cyprus (although your earned income may still be taxable in the country of origin)"



Also mentioned

A 90-day rule exemption also exists, whereby remuneration from salaried services rendered outside Cyprus for more than 90 days in a tax year to a non-Cyprus resident employer or a foreign permanent establishment of a Cyprus resident employer are exempt from taxation.
The 90 days need not be consecutive provided that:
-they fall within the same tax year;
-the individual remains a Cyprus tax resident (ie, they must spend between 90 and 183 days abroad); and
-an employer-employee relationship must exist (ie, sole traders and freelancers cannot benefit from this exemption).
-Further, any gratuity income on retirement is exempt from taxation. If a foreign national receives foreign pension income, they can elect to have it taxed:
"the individual remains a Cyprus tax resident (ie, they must spend between 90 and 183 days abroad); and"


I have never heard anything like this before for any other country. So basically if you leave the country for 3 months and you work abroad during  that time, all income generated in that full one year (i.e. 9 months living and working in Cyprus and 3 months living and working in another country), all that income for that year is tax free?


will you not be taxed in the country of origin?

MikeGreo

Toon wrote:

will you not be taxed in the country of origin?


What I was thinking was if I lived in Cyprus for 9 months and 3 months in another country than my salary will be free for the whole tax year?

This is what I am confused about.

"If you are employed abroad for over 90 days a year, your entire salary may be free of Cyprus taxes. This applies if your employer is not tax resident and does not have a permanent establishment in Cyprus (although your earned income may still be taxable in the country of origin)"

Is the exemption mentioned here for the whole 12 months (i.e 9 months living in Cyprus and 3 months elsewhere). Or is only the 3 months of the salary that has been worked outside of Cyprus tax free?

Toon

It does say “may†though have a consultation with blevins Franks am sure they give you the best possible advice

Toon

If it is your intention to live here in excess of 3 months then you must and are obliged to register as resident and that has implications best to speak to the professionals....

Toon

tax facts and figures 2020....

Toon

This may be of interest to you

Cyprus tax residency and non domicile rules plus the 60 days rules

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