Taxation of Property Income
How much is tax on property income?
Residents and non-residents must pay tax on property income at standard income tax rates, and property income must therefore be included in your annual income tax declaration.
However, a 20 per cent deduction from letting income is allowed, as is any interest on a loan taken out to purchase or improve the property; there’s a further 3 per cent deduction for depreciation.
Residents must pay an additional tax at 3 per cent (known as Special Contribution for Defence) on 75 per cent of their total rental income. For example, on letting income of CY£15,000, you would be taxed as follows:
|
Income Tax |
CY£ |
|
Letting income |
15,000 |
|
Exemption |
(10,000) |
|
Taxable income |
5,000 |
|
Deductions (23%) |
(1,150) |
|
Net taxable income |
3,850 |
|
Tax at 20% |
770 |
|
SCD |
|
|
Taxable income |
15,000 |
|
Allowance (25%) |
(3,750) |
|
Net taxable income |
11,250 |
|
Tax at 3% |
337.50 |
|
TOTAL TAX |
1,107.50 |