Capital Gains Tax Changes in Cyprus from 2026: What It Means for Property and Land Owners
From 1 January 2026, important changes to Capital Gains Tax (CGT) came into force in Cyprus, directly affecting property owners, landowners, and developers. These changes are particularly relevant for those selling residential property, disposing of land, or exchanging land for newly built apartments.
What Is Capital Gains Tax in Cyprus?
Capital Gains Tax in Cyprus applies when a person makes a profit from selling:
- Residential or commercial property
- Land
- Shares in a company that owns property in Cyprus
The CGT rate remains 20%, but what has changed from 2026 are the exemptions and the way certain transactions are treated, making the system more flexible and, in many cases, more favourable.
Selling Property: Higher Exemptions
If you sell a property in Cyprus after 1 January 2026, you may benefit from higher lifetime tax-free exemptions.
For individuals:
- The general lifetime exemption on capital gains has increased.
- The primary residence exemption (for your main home, subject to conditions) has been significantly increased, meaning many homeowners will pay less or no CGT when selling their home.
This makes selling residential property more tax-efficient, especially for long-term owners.
Selling Land: What Has Changed?
When selling land, Capital Gains Tax still applies on the profit made. However, the increased general lifetime exemption can now reduce the taxable amount more effectively than before.
This is particularly beneficial for:
- Landowners who purchased land many years ago at low cost
- Families selling inherited land
- Investors restructuring land holdings
Land Exchanged for Apartments (Development Deals)
One of the most important and practical changes from 2026 αφορά land-for-development agreements, a very common practice in Cyprus.
In these arrangements, a landowner gives land to a developer and, in return, receives completed apartments instead of cash.
Before 2026, Capital Gains Tax could be triggered immediately at the time the land was transferred, even though the landowner had not yet received the apartments.
From 2026, this treatment has improved:
- Capital Gains Tax is not triggered immediately when land is exchanged for apartments.
- The tax event is deferred until the landowner actually receives or sells the completed apartments.
- This allows landowners to avoid paying tax before they benefit from the development.
This change provides much better cash-flow planning and removes a major obstacle for landowners considering development agreements.
What This Means for Property Owners and Investors
The 2026 Capital Gains Tax changes make Cyprus more attractive for:
- Homeowners planning to sell
- Landowners considering development opportunities
- Investors restructuring property portfolios
- Families holding land for long-term value
Higher exemptions and fairer treatment of land-for-apartment exchanges reduce tax pressure and encourage development and transactions.
Professional Advice Is Still Essential
While the new rules are more favourable, Capital Gains Tax exemptions are lifetime-based and depend on personal circumstances, previous sales, and the structure of each transaction. Proper planning is essential to maximise benefits and avoid surprises.
At The Property House, we work closely with legal and tax professionals to help our clients understand how these changes affect their property decisions and to guide them through sales, purchases, and development opportunities with clarity and confidence.
For tailored advice on selling property, land, or entering a development agreement in Cyprus, contact The Property House.