Changes to VAT legislation for building deliveries in Cyprus

On February 27, 2026, the Cyprus government published amendments to the VAT Law (95(I)/2000), specifically impacting Tables 5 and 8 regarding property taxation. Starting September 1, 2026, new criteria for VAT application on building transfers will come into effect. Property transfers occurring before the first installation remain subject to VAT. First installation is defined as the first use of a building, including self-residence, commercial utilization, or rental. A property is considered to have undergone first use if it has been systematically utilized or exploited for a duration of at least 18 months. Transfers made after this 18-month threshold are generally exempt from VAT. For properties not meeting the 18-month usage criteria, applicants may request a reduced VAT rate under specific business activity conditions. These legislative adjustments are part of broader efforts to align property tax frameworks with European standards and improve transparency.