Northern Cyprus Taxes: What Investors Need to Know

Cyprus, an island in the eastern Mediterranean Sea, is politically divided into two distinct parts. The northern part of this island is known as the “Turkish Republic of Northern Cyprus” which has experienced the declaration of separation from the Republic of Cyprus between 1974 and 1983. In recent years, Northern Cyprus has seen significant growth in various fields, and this growth has attracted many investors to this area. One of the main concerns of investors in this region is the tax situation. This article, with the support of White Eagle Holding, aims to provide a complete and comprehensive review of the tax system in Northern Cyprus.

Northern Cyprus Taxes: What Investors Need to Know

An overview of the tax system in Northern Cyprus

Northern Cyprus has a very simple and efficient tax system that is very attractive to foreign investors. This area has no income and salary taxes, and there are no property, inheritance or transaction taxes. But there are some other taxes like investment income tax, value added tax (VAT) and real estate tax.Also, by reading our article about the process of buying a property in North Cyprus, you can get more information about the process of buying a property in North Cyprus!

Tax on investment income

In Northern Cyprus, tax on investment income is very low and many investment incomes are tax exempt. This has made North Cyprus a popular destination for foreign investors, especially in real estate. In fact, investors can continue their investment activities without worrying about paying heavy taxes.

Also, by reading our article about the process of buying a property in North Cyprus, you can get more information about the process of buying a property in North Cyprus!

value added tax (VAT)

Value added tax (VAT) is also applied in Northern Cyprus in a simple and lower manner than in many other countries. The value added tax rate in this country is only one percent, which is applied to services and goods such as food, clothing and fuel. This low rate is another reason why this region is attractive for foreign investors.

Real estate tax

In Northern Cyprus, there is also a real estate tax. This tax is calculated based on the market value of the property or its annual rent. Currently, the tax rate is a few percent, which is much more suitable than other countries and encourages investors to invest in the real estate market of this region.

Trying to attract foreign investors

Northern Cyprus is actively trying to make the business environment simple and friendly for foreign investors. Although taxes are low in this country, other costs such as transportation and raw material costs may be high. Therefore, it is essential to consider all the costs associated with doing business in North Cyprus. But due to simple and low-cost tax policies, this country has become one of the attractive destinations for investors.

An overview of the tax system in Northern Cyprus

Is the tax on investment income different for foreigners?

In Northern Cyprus, the tax on investment income is no different for foreigners and locals. There is no tax on investment income in this country, and all people, regardless of nationality or gender, enjoy these exemptions. This simple and equal tax policy has been developed in order to attract foreign investment and encourage investment in North Cyprus, and it is considered one of the main attractive factors of this region for foreign investors.

Tax filing procedures in Northern Cyprus

To file a tax file in Northern Cyprus, investors need two basic things:

1. Registration or establishment of a company

To register as a business in Northern Cyprus, you must first register your company. For this, you can visit our company registration service page!

2. Registration in the tax office

After registering the company, you must go to the relevant tax office and declare your registration as a new customer. At this stage, you will need to provide information such as your company name and address, how your business operates, and other information related to your bank accounts. After completing the registration process, you can apply for a tax number by visiting the relevant tax office and get detailed information about the tax system of North Cyprus.

Next, we should mention that one of our services in North Cyprus is the company registration service in North Cyprus! You can get more information by visiting our Northern Cyprus company registration services page!

Documents required for tax filing

To file a tax file in Northern Cyprus, you must submit the following documents to the tax office:

• Birth certificate: You must provide the birth certificate of yourself and your spouse (if married).
• Proof of Address: Include health, utility, or internet bills that verify your address.
• Company identification documents: including company birth certificate, company establishment certificate and other related documents.
• Bank account documents: including account number and IBAN number.
• Tax documents: including tax returns, income certificates, bills and other related documents.
• VAT related documents: including VAT number and VAT certificate.
• Documents related to employees: including birth certificate, passport and other documents related to employment.

Documents required for tax filing

Also, to ensure the correctness and integrity of the tax file, it is better to work with a local accountant or tax lawyer in North Cyprus, such as White Eagle Holding lawyers. These people can help you in all stages of registration and solving tax uncertainties.

Finally, North Cyprus has become one of the attractive destinations for foreign investors with its simple and low-cost tax system. However, to be successful in doing business in this region, you must consider all the costs associated with doing business in this country and benefit from professional advice.