How is income tax calculated in Cyprus?
From 1 January 2026 the first EUR 22,000 of chargeable income is tax-free; the rates are then 20% to EUR 32,000, 25% to EUR 42,000, 30% to EUR 72,000 and 35% above.
Employees pay 8.8% social insurance on earnings up to EUR 68,904 a year (2026) and 2.65% General Health System contributions on income up to EUR 180,000.
Both contributions are deductible, within an overall limit of one-fifth of chargeable income that also covers life insurance and pension contributions.
What is the income tax rate in Cyprus?
| Taxable income | Rate |
|---|---|
| €0 – €22,000 | 0% |
| €22,000 – €32,000 | 20% |
| €32,000 – €42,000 | 25% |
| €42,000 – €72,000 | 30% |
| Over €72,000 | 35% |
What mandatory salary deductions apply?
- Social insurance (employee): 8.8% of pay, on up to 68,904 a year.
- General Health System (employee): 2.65% of pay, on up to 180,000 a year.
Gross salary and take-home salary
Gross salary is what your contract says before anything is taken off. Take-home salary is what reaches your bank account after income tax and the compulsory employee contributions. Employer contributions are paid on top of your salary and are not taken from it.
Example: €2,700.00 a month
An employee earning 2,700 a month, about US$3,000.
| Item | Monthly | Annual |
|---|---|---|
| Gross salary | €2,700.00 | €32,400.00 |
| Income tax | €111.50 | €1,338.04 |
| Compulsory contributions | €309.15 | €3,709.80 |
| Take-home pay | €2,279.35 | €27,352.16 |
Effective income tax rate 4.1%; all deductions 15.6%.
Frequently asked questions
How much income is tax-free in Cyprus in 2026?
The first EUR 22,000.
What is the social insurance rate?
8.8% for employees, on earnings up to EUR 68,904 a year.
What is GHS?
The General Health System contribution: 2.65% of an employee's emoluments, capped at EUR 180,000 of income.
Official sources
- PwC Worldwide Tax Summaries (reviewed 4 August 2026): Cyprus – Individual – Taxes on personal income. Read 5 November 2026.
- PwC Worldwide Tax Summaries (reviewed 4 August 2026): Cyprus – Individual – Other taxes. Read 5 November 2026.
- PwC Worldwide Tax Summaries (reviewed 4 August 2026): Cyprus – Individual – Deductions. Read 5 November 2026.
Last reviewed 5 November 2026. An estimate for planning, not tax advice; your employer’s payroll and the tax authority decide what is actually withheld.
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