The Importance of the Non Dom 60 Days Ruling vs. the Non Dom 183 – Exempt from Special Defence Contribution (SDC) in Cyprus

The shifting sands of international taxation require astute entrepreneurs to stay abreast of the latest developments. One such development that’s been the talk of the business town in Cyprus is the Non Dom tax regime. Specifically, the intricacies between the Non Dom 60 days ruling and the Non Dom 183 days – Exempt from Special Defence Contribution (SDC). This article aims to elucidate these schemes and shed light on their importance.

Understanding the Basics:

Non Dom 60 Days Ruling: Introduced to cater to the needs of globally mobile professionals and entrepreneurs, this ruling stipulates that if an individual spends more than 60 days but less than 183 days in Cyprus within a tax year and meets other specific conditions, they are deemed a tax resident of Cyprus.

Non Dom 183 Days – Exempt from SDC: Traditionally, to be considered a tax resident under the Non Dom regime in Cyprus, an individual had to spend at least 183 days in the country. Under this scheme, tax residents are exempt from the Special Defence Contribution (SDC) on specific income types.

The Strategic Advantage of the 60 Days Ruling:

The introduction of the 60 days ruling allows for greater flexibility. Individuals who are not tax residents in any other state for the same tax year and don’t stay in any other country for more than 183 days have an alternative method to gain tax residency in Cyprus. This is pivotal for professionals and entrepreneurs who work in multiple jurisdictions and do not wish to be overly committed to one place.

SDC Exemption:

The exemption from the Special Defence Contribution under both rules is of paramount importance. It means individuals qualifying under these schemes don’t pay SDC on dividend, interest, or rental income, further solidifying Cyprus’s position as a favorable jurisdiction for high-net-worth individuals and global professionals.

Economic Implications:

By introducing these nuanced pathways to tax residency, Cyprus has aligned itself more competitively within the European landscape, attracting foreign direct investments, skilled professionals, and fostering economic growth.

Enhanced Global Mobility:

The two rulings cater to different segments of the global workforce. While the 183 days rule may appeal to those looking to make Cyprus a more permanent base, the 60 days rule is tailored for those who epitomize the modern, mobile global professional.

The Road to Compliance:

While both the Non Dom 60 days and the Non Dom 183 days offer attractive propositions, it’s crucial to ensure strict compliance with the conditions stipulated to benefit from the exemptions and advantages they offer.

In conclusion, the Non Dom rulings in Cyprus represent a strategic pivot towards fostering a business-friendly environment that appeals to both long-term residents and the globally mobile workforce. The dual approach of the 60 days and the 183 days rulings ensures that Cyprus offers a tailored tax solution, whatever your global footprint might be.

At Advocates Cyprus, we pride ourselves on our deep-rooted understanding of the Cypriot tax landscape. Should you wish to navigate the nuances of these Non Dom regulations or need guidance on any other aspect of doing business in Cyprus, our team of seasoned professionals is here to assist.

For more information on the Non Dom tax rulings or any other queries, contact Advocates Cyprus at [email protected] or call us at +357 24 023370.

About Advocates Cyprus

Advocates Cyprus is a distinguished provider of legal and corporate services in Cyprus. With a team of experts spanning various sectors, we offer comprehensive guidance, regulatory advice, legal services, and more. Our commitment is to excellence and to ensuring our clients achieve their objectives with ease and efficiency.

This article is designed for informational purposes. Should you require further expert insights, please get in touch with us:

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Published on: 25/08/23