Taxes in North Cyprus: A Guide for Property Buyers & Investors
North Cyprus offers attractive tax benefits for property buyers and investors, making it a popular destination for real estate purchases. Below is a breakdown of the key taxes and fees you should be aware of when buying, selling, or owning property in North Cyprus.
1️⃣ Property Purchase Taxes & Fees
✅ Title Deed Transfer Tax (Stamp Duty) – 6% (Reduced to 3% for first-time buyers)
This is a one-time tax paid upon transferring the title deed (Koçan) to the buyer’s name. First-time buyers benefit from a reduced rate of 3%, while standard rates apply at 6%.
✅ VAT (Value Added Tax) – 5%
Payable on the purchase of new properties from developers. If the property is resold by an individual (not a developer), VAT may not apply.
✅ Stamp Duty – 0.5% of the contract value
This fee must be paid within 21 days of signing the sales contract to register it at the Land Registry Office.
✅ Contract Registration Fee – Approx. 0.5%
Registering the contract with the District Land Office ensures legal security over your purchase.
✅ Real Estate Agent Commission – 3%
If you purchase through an estate agent, their commission fee is typically 3% of the sale price.
2️⃣ Annual Property Taxes
✅ Municipality Tax – Approx. 1-3 TL per m²
This is a small annual tax payable to the local municipality for services such as waste collection and infrastructure maintenance.
✅ Property Rental Tax – 10% of rental income
If you rent out your property, you must declare and pay a 10% rental income tax annually.
✅ Capital Gains Tax on Property Sales – 2.8% – 4%
If you sell your property, capital gains tax applies based on whether the seller is an individual or a company.
- Individual sellers (1st sale exemption): First-time sellers may be exempt.
- Subsequent sales: Taxed at 2.8% to 4% depending on the circumstances.
3️⃣ Other Financial Considerations
✅ Inheritance & Gift Tax – 0 – 6%
Inheritance tax in North Cyprus is significantly lower than in many other countries, ranging from 0% to 6% depending on the relationship between the inheritor and the deceased.
✅ Bank Transfer Fees – Varies by bank
If you’re transferring money from abroad to purchase property, be aware of international bank fees and exchange rate fluctuations.
✅ Foreign Exchange Rate Impact
Since transactions are often in GBP (£) or Euros (€), fluctuations in exchange rates can affect the total amount paid.
Why Invest in North Cyprus?
🔹 Low property taxes compared to many European countries
🔹 Attractive tax incentives for foreign investors
🔹 No wealth tax, and relatively low income tax for rental properties
🔹 High rental yields with increasing tourism and expat demand
Join The Discussion