Cyprus's reduced VAT rate transition period ends in June 2026
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Amendments were made to the VAT Law in June 2023. The reduced rate now applies to the first 130 m² of living space, provided that the property value does not exceed €350,000 and the total transaction value is no more than €475,000.
This reform effectively eliminated the possibility of a 5% VAT rate for villas and premium apartments; however, the previous version of the law — including the reduced rate — remains in effect for projects that received planning permission prior to November 2023.
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- A transitional period for property owners to apply for the reduced VAT rate remains in effect until June 15, 2026.
- Anyone who fails to submit an application for the reduced VAT will automatically be subject to the new rules (5% on only 130 m² and 19% on the remaining area).
It is important not only to make the down payment but also to submit the application to the tax authorities before June 2026.
After June 2026, there will be no properties left on the market eligible for the ’old’ 5% reduced rate.
From 205,000 €
Completion in: 2027.II Total of 105 apartments
From 520,000 €
Built in 2022 64 units in total
From 800,000 €
Built in 2025 67 units in total
From 320,000 €
Completion in: 2028.IV Total of 88 apartments
From 845,000 €
Completion in: 2027.I Total of 330 apartments
From 545,000 €
Completion in: 2026.IV Total of 24 apartments
From 510,000 €
Completion in: 2026.IV Total of 44 apartments
The full impact of the reform on pricing and development within the premium segment remains to be assessed.
Depending on the property’s size and value, the additional costs will amount to 2–5% of the property’s cost if the established conditions are met, or rise to 14% if the price or area limits are exceeded.
Learn about available projects featuring the reduced VAT rate during a personalized consultation with a Tranio expert — submit your request.
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