Some forms of income are tax-exempt/reduced as follows:
- A dividend received by individuals from a Cypriot company is tax exempt but subject to 17% SDC, special defense contribution
- Interest income is tax exempt too but subject 30% SDC.
- A dividend received by a Cypriot company from another Cypriot company is tax exempt subject to certain conditions.
- A dividend received by a company from a EU company fulfilling the EU parent subsidiary directive is tax exempt.
- Capital gain from sale of a whole business between family members, as defined by law, is subject to 1.2% tax (spouse, child) or 2.4% only, depending on the family closeness of the buyer.