On 15 December 2020, an amending law was published in the Official Gazette of the Republic which relates to Article 8(21) of the Income Tax Law.
The purpose of the amendment is to extend the application of the 20% or €8,550 (whichever is the lower) tax exemption for remuneration from employment which is exercised in the Republic by an individual who was resident outside Cyprus the tax year prior to the commencement of his employment in the Republic.
Under the old framework, the exemption could be claimed for a maximum period of five years, from 1 January following the year of commencing employment, up to tax year 2020.
Under the new framework, an individual whose employment in the Republic commenced up to the year 2025, has the right to claim the relevant tax exemption for a period of five (5) years (i.e. up to the year 2030 inclusive). The said amendment applies as of 1st January 2020.
