Unlike citizens of the Republic of Cyprus and EU nationals, a permit for the acquisition of properties in Cyprus for Non-EuU nationals must be obtained. The Application is submitted once the deal for the property has been finalised and have proceeded with the execution of the sale agreement.

The non-Eu national will not be allowed to register the immovable property under his name without furnishing permit by the Council of Ministers of the Republic for the following type of properties:

• apartment
• house
• building plot or land up to approximately two donums (2,676 square metres)

This permission is obtainable provided that the property is not intended for commercial exploitation. In certain cases, however, the Council of Ministers may grant the approval for the acquisition of property for commercial purposes if the particular project is considered to help the Cyprus economy in general (e.g. in terms of tourism or employment).

A company owned by Non-Eu Nationals may also acquire premises for their operations (with no limit on the extent) and for the residence of their foreign employees, provided they maintain a fully-fledged office and the residence to be registered on the name of the employee.

PROCEDURE FOR OBTAINING THE IMMOVABLE PROPERTY PERMIT – COMM 145

We prepare and submit on behalf of the applicant the application with all required supporting documents to the Local District Office where the applicant resides. In turn the District Office once satisfied will prepare their report and submit it to the Council of Ministers for their decision.

If the Council of Ministers is satisfied, it shall give instructions to the District Office to issue the relevant Permit.

The following documents are required and accompany the COMM 145 application form:

• Application COMM 145 duly completed and executed.
• Survey plan of the property
• Copy of the title of deed (certificate of ownership) of the property
• Copy of the building permit for the erection of the house/block of flats or for the residential development of estates. If separate titles of ownership have been issued for the flats of the block or if the house is mentioned on the title of ownership, applicants need not submit a copy of the building permit. For plots under division, applicants must submit a copy of the division permit.
• Copy of the sale contract duly stamped by the Inland Revenue Department.
• Level Plan of the house or the flat.  A division plan must be submitted in the case of division of plots. In areas of residential development, the plan must be submitted showing the position of the house on the entire holding.
• Documents stating the financial situation of the applicant.
• Copies of the pages of the applicant’s passport and those of his spouse (the pages containing the data and the photo of the holders and stamps of arrival to and departure from Cyprus).
• Certificate of marriage of the applicants or relevant attestation of their Embassy and in cases where the spouses do not have the same surname and when the name of the husband is not written on the wife’s passport.
• Copy of the residence permit or work permit of the applicant in the Republic of Cyprus.

Time Frame

The review period by the District Office and Council of Ministers is usually concluded within 30 – 40 days.

For any questions regarding the immovable property permit in the Republic of Cyprus contact us at info@ddlegal.co 

For example:

1. In the food industry with a total staff of 100 people, with the following separation:

75 people in product production and distribution: ALL EMPLOYEES ARE ENTITLED TO WORK

25 staff in the offices (Accounting, Marketing, Administration, Reception, etc.): 15% OF THE OFFICE PERSONNEL SHOULD WORK , IE. RIGHT TO WORK 4 PERSONS

2. In a company connected to the construction industry, such as the sale of sanitary ware with a total number of employees of 30 people.

20 people in the Warehouse, distribution and service of professionals in the sector: ALL EMPLOYEES ARE ENTITLED TO WORK

10 staff in the offices (Accounting, Administration, Reception, showroom, etc.): 15% OF THE OFFICE PERSONNEL SHOULD WORK, WITH MINIMUM PRESENCE OF THE 3 EMPLOYEES,

IE. RIGHT TO WORK 3 PERSONS

The applicable law relating to trusts in Cyprus is based on the Trustee Law chapter. 193 and on the International Trust Law 1992 to 2013 as amended law 2012, hereinafter collectively referred to as “The Law”.

Cyprus international trust is a form of estate planning, which is usually used by wealthy individuals irrespective of their domicile (place of residence) who wish to ensure the security of their assets for their family, while benefiting from the international tax planning.

A Trust is a legal arrangement where the settlor passes ownership of the assets pretrained in the trust to the Trustee for the benefit of the beneficiaries.

1. The Settlor is the creator of the Trust.
2. The Trustee is a legal or natural person, who holds or has trust property transferred to him or will be held by him, or is deemed to hold or have had trust property transferred to him, or is expected to have trust property delivered or transferred to him, to be held by him:
   1. for the benefit of a beneficiary irrespective of whether the trustee is also beneficiary of the trust; and/or
   2. for any purpose which is not for the exclusive benefit of the trustee.

3. The beneficiary may be a legal or natural person including a person not yet born, such as a grandchild, at the time of the creation of the trust, or a person who is part of a class of people entitled to a right or interest in property which is subject to the trust.

A trust can be created in two forms:

• An individual Trust, where an official Trustee is appointed under the Trustee Law.
• Corporate Trust, where a corporation is appointed by the Court in any case to be a trustee, or a trust company is registered under the Companies Law.

Criteria of Cyprus international Trusts

The Cyprus International Trust regime offers overseas individuals who are not residents of the Republic to create a Trust in Cyprus in which they benefit from provisions of non-taxed residents of Cyprus. The trust may be classified as an International Trust when the below criteria are met:

• The settlor, being either a natural or legal person, is not a resident of the Republic during the calendar year immediately preceding the creation of the trust
• At least one of the trustees is a resident in the Republic during the whole duration of the trust
• No beneficiary, whether a natural or legal person, other than a charitable institution, is a resident of the Republic during the calendar year immediately preceding the year in which the trust was created.

Exception: A trust shall not fail to qualify as an international trust by reason only that any of the parties involved is a company or a partnership. The exception offers opportunities for high net worth individuals and investors, to maintain full control of the management of the trust, by using a Cyprus Company as the sole trustee in which the assets are transferred and held.

Validity of a Trust:

In general, it is noted that there are no formalities needed in creating a Trust in Cyprus, except where the trust is created by a Will. 

The Three Certainties test:

Although there are no formalities needed for the creation of a trust the below criteria of the 3 certainties must be satisfied:

• Certainty to intention-the settlor needs to express an intention to create the trust
• Certainty to subject matter-The trust property must be readily identifiable otherwise the trust is void for uncertainty.
• Certainty of objects-The identity of all the beneficiaries of the trust must be ascertained or ascertainable at the time of setting up the trust.

Stamp Duty Expenses: An instrument creating an international trust shall be liable to stamp duty of the amount of 430 Euro to the Commissioner of Stamp Duty.

Other benefits of Cyprus International Trust

• Confidentiality – No information may be disclosed to any person who has no right by law to have knowledge of such documents and information, unless an Order for disclosure is issued by the relevant Court.
• Duration – Trust do not have an expiration date.
• A Trust setup may be used to protect assets against risks, future claims by governments or creditors.
• There is no registration or reporting requirements.
• It is possible for the Settlor and the Beneficiaries to relocate to Cyprus after the establishment of the Cyprus International Trust as the law allows them to do so on the condition that they were not residents of Cyprus before the establishment of the Trust.
• Taxation – If a Beneficiary is a resident of the Republic of Cyprus and of whom profits of International Trust are earned from sources within and outside the Republic shall be taxed. Moreover, in the event that the Beneficiary is not a resident in the Republic then profits earned from sources within the Republic of Cyprus shall also be taxed.

Power of the Settlor

A Settlor has the ability to reserve certain powers and rights, which does not affect the validity and execution of the Cyprus International Trust. Such powers include:

• to revoke or amend the terms of a trust or any trusts or powers arising wholly or partly under it;
• to advance, distribute, pay or otherwise apply income or capital of the trust property or to give directions for the making of such advancement, distribution, payment or application;
• to exercise the powers of a director or officer or issue binding directions as to the appointment or removal of a director or officer of any company, wholly or partly owned by the trust;
• to give binding directions to the trustee in connection with the purchase, retention, sale, management, lending, pledging or charging of the trust property or the exercise of any powers or rights arising from such property;
• to appoint or remove any trustee, enforcer, protector or beneficiary;
• to appoint or remove any investment manager or investment adviser;
• to change the applicable law governing the trust or the forum for the administration of the trust;
• to restrict the exercise of any power or discretion of a trustee by requiring that they are only exercisable with the consent of the settlor or any other person expressly specified in the terms governing the trust.

Step 1 – Research and Budgeting

Research potential properties that interest you that will be within your price range. 

It is crucial to have in mind the additional cash expenses that you will have to cover for the finalisation of the sale and issuance of title deed, which are as follows:

• Transfer fees payable at the Department of Lands and Surveys (DSL) 
• Loan deposit in cash for the approval of the loan will be at 20% for a Permanent residence, 30% for a second residence (Holiday house) and 40% for an investment.

Step 2 – Hire a good reputable Estate Agent

Find a reputable and professional agent that will guide you through your selection process and provide you with viable options. 

Step 3 – Have your Bank pre-approved your mortgage

Deals most often than not fall out due to the buyer’s inability to secure the money required for the purchase. We suggest contacting your bank for a credit check and have available for submission all required documents for your loan application for expediency purposes. 

Step 4 – Shortlist and final screening with a professional

Once you have identified the properties that interest you revisit the property with your estate agent and a professional in the field such as mechanical engineer to identify any construction flaws and repairs that may be needed which you do not have the technical expertise to identify.

Note: It has been our experience that buyers have had to pay extensive amounts on repairs which were not accounted for in the purchase. Hiring a professional to survey the house prior to purchasing a property is highly recommended even for new houses.

Step 5 – Make your offer 

Once you have screened the properties make an offer. Your offer if you choose may include terms such as repairs and methods of payment. 

Step 6 – Hire an experienced Real Estate Lawyer 

Once your offer has been accepted, it is vital that you hire an experienced Real Estate Lawyer to conduct all necessary searches to safeguard a successful transfer of title dead. 

What we will be doing for you:

• Conduct a search at the DSL to verify the owner of the property
• Conduct a search at the DSL to verify that the property is free from any encumbrances. 
• Review or draft a sales Agreement for the property
• Provide you with a checklist of all the tasks that need to be finalised upon transfer of title dead.

We have encountered numerous times complicated issues with ownership or encumbrances by banks or businesses on a property. For such situations we shall advise on how to safely navigate around such issues and coordinate with all related parties to make the deal possible. 

Step 7 – Finalising the Purchase

Once all issues have been identified and tackled, we shall set a date to finalise the transaction at the DSL in collaboration with the bank in situations where we have a mortgage or a memo. We shall coordinate with the Estate Agent and submit all relevant documents to the DSL. 

All parties involved will be present for the transfer and once all paperwork are executed and the transaction is concluded the relevant fees for the transfer of property will need to be paid to the DSL.

Step 8 – Insure your property

We strongly advise to get home insurance once the ownership has been transferred in your name to safeguard your investment.