The 2026 Cyprus tax overhaul changes the income-tax bands, raises the personal allowance to €20,500, and introduces new employee credits. Here's exactly how yo…
The 2026 personal-income-tax reform — passed in November 2025 — is the biggest overhaul of the Cyprus tax code in 20 years. For most employees it means more money in your pocket. For high earners the picture is mixed. The new income-tax bands (2026) Annual income (€)Tax rate 0 – 20,5000% 20,501 – 30,00020% 30,001 – 40,00025% 40,001 – 80,00030% 80,001+35% The personal allowance jumped from €19,500 to €20,500 — so anyone earning under that threshold now pays zero income tax. What stayed the same Social Insurance: 8.8% employee / 8.8% employer. GESY (National Health): 2.65% employee / 2.9% employer. Special Contribution to Defence on dividends and interest is unchanged. What changed for high earners The 50% expat / IT exemption for new tax residents now triggers at €55,000 (down from €100,000) — a major win for mid-senior international hires. The exemption still runs for 17 years, unchanged. Stock-option taxation now defers to the vesting date, not the grant date. Take-home examples (single, no dependents) Gross annual2025 take-home2026 take-homeChange €20,000€17,690€17,710+€20 €30,000€24,610€25,090+€480 €50,000€37,860€38,860+€1,000 €80,000€56,360€56,860+€500 €120,000€77,610€77,110–€500 New employee credits €1,500 child credit per dependent child (up from €1,000). €2,000 single-parent supplement. €500 green-commuting credit — EV or e-bike registration required. €1,000 first-home-buyer credit. How to plan around the reform Model your exact take-home with the Kyprium Cyprus Tax Calculator 2026. If you're negotiating, the new 25% band (€30k–€40k) is the sweet spot — every extra euro of gross raise nets you roughly €0.75 in take-home. On stock options, aim for vesting years where your other income is lower — the deferred taxation rule now works in your favour. Browse jobs by salary See open jobs filtered by salary → and pair each offer with the calculator before you accept.